A contractor’s work crew was doing some repairs on my house, and since I work from home, I heard the conversations of the workers all day. Their focus was on fishing, concerts, and their next tattoo while they struggled to feed their children and stay current on their rent. These tradesmen were not kids in their teens and twenties but were in their mid-to-late 30s.
As I was helping one of them jump-start their car, because he couldn’t afford a new battery, I asked him how he prioritizes his spending. I have mentioned before, the most difficult question in money management is how you go about calculating what you can afford. He replied, “When I have money then I spend it. That is it. If I have an extra $100, I get a new tattoo but I also buy one for my girlfriend so she won’t get mad that I spent money.”
Over the next few days, I asked a few questions and learned that:
- None of them have any savings or a retirement accounts
- Most were touch and go about making rent each month
- Way too much of their income went to bars, alcohol, cigarettes, and lottery tickets
- The mention of the word “investing” returned blank stares to me
There is nothing the matter with spending money on a Starbucks coffee and case of beer for the weekend. But when you have trouble making rent, every single month, it may be time for a financial intervention.
When I had to front extra money to the contractor beyond supplies to provide some advances to his crew, I remembered the saying (I believe from Robert Kiyosaki), “Those who cannot manage their money work for people who do manage their money.” This was solidified with their stories about struggle, inconvenience, and victimhood because they were so financially strapped. I offered some casual advice at opportune moments, but my impression is that it was so outside of their way of thinking and living, that it simply didn’t make any sense to them. As in, “Sure, I’ll save money when someone gives me a million dollars – haha!”
As I see it, nearly every aspect of your life depends upon money. So your skill level of money management and discipline will determine whether your life is a continual financial struggle or making progress toward financial stability.