Saturday, January 3, 2015

A word on who this blog is for, and some deep philosophy

Most money management blogs, books, seminars and, well, pretty much anything else, are geared toward people who have jobs and make decent money. I sometimes then see feedback from folks who say, "Hey, what about those of us who make hardly any money? Am I supposed to squirrel away the $5-10 I don't need for rent and groceries in the hopes of investing in mutual funds?"

The answer is pretty much the same everywhere: No, you shouldn't. And money management experts (of which I am definitely not) are short on advice for people who don't make enough money to fill their basic needs. The type of advice they have to give is just not going to work on that level. It's just not. But I did once hear some good advice from money management guru Dave Ramsey on one of his call-in shows years ago. He was talking to a guy who had four kids and a wife who was a stay-at-home mom. When his wife felt he worked too much, she asked him to take a lower paying job that allowed him to be home more. He was now trying to make ends meet on a salary of $15,000 per year.  Dave's advice? Buddy, you don't make enough money to support a family of four. You need to go back to a higher paying job.

Now, I know that not everyone has that option, and that's a tough reality of life, one for which I'm not remotely qualified to give advice on. What I can tell you, though, is that if you are struggling to get by on the money you earn, don't worry about saving or investing; worry about making more money. That's the reality, and that's the reason that money management advice is really geared toward people who already make enough money. Why? Simple. Because those are the folks who are easy to help.

So who are you? Well, hopefully, you're kind of like me. You make enough money, but you spend a lot. You think you make good decisions, but then you look at your checkbook (or your Mint, or YNAB, or Quicken account) and think "Where the hell did all my money go?"  You try to save money, or pay off debt, and month after month it just doesn't happen. You get a raise, and a year later you still don't see any of it.

And you see all these articles in Forbes and Fortune telling you it's okay, you're in the middle class, and the middle class is squeezed more and more every year, and it's really hopeless because life is just really hard, and gas is really expensive, and housing prices are astronomical, and by the way, you have just GOT to get the new iPhone 6 for yourself and everyone else in your family, and of course all parents who love their children will only drive them around in the largest SUV on the market. But be sure to get this year's model, because it has a backup camera.

It's hard to jump off the treadmill, but it can be done.

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