I struggle mightily with both scenarios – saying no to myself, and to others, but it is something I have vowed to work on. Not because I am mean, or unwilling to help, but because no is a powerful tool to protecting my family’s finances, and at times, my own sanity.

Saying No to Yourself

Much of the economic problems our country faces can be attributed to our inability to say no to ourselves. No to more spending. No to a bigger home we cannot afford. No to accumulating more debt. Why is it so hard to tell ourselves no?

As kids, we are quite accustomed to hearing the word no. I went through a very curious stage myself where I’m told I tried to get into all sorts of things. My mom joked that she was afraid I’d grow up to think my name was “No Jason.”

Then we reach a stage in life called the teen years, where we are told to still say no to bad things, but occasionally say yes (and work hard to keep it from our parents!). But the older we get, the less accountable we are to others, and the more accountable we are only to ourselves.

I’m reminded of a famous quote on the subject of integrity: “Integrity is doing the right thing even when no one is looking.”

Well, to me this describes our decision-making process as young adults. After all, if young and single, chances are you are accountable to no one regarding personal decisions. This is why continuing to say no to yourself is so difficult.

The problem is before we wake up by the age of 30 with a spouse and two kids, we can do a lot of damage. I know; we squandered much of our 20s over-spending and accumulating debt on cars, school and other more frivolous things.

Looking back, I recognize we missed a great opportunity to get a jump on building wealth, and providing a more stable financial foundation for our family to come. If only we’d said no more often.

Saying No to Others

For some, saying no to others is infinitely more difficult than telling themselves no. These people are often categorized as “pleasers.” They put their own needs aside to please others. They are unselfish, to a fault.

There are plenty of good reasons to tell others no. Whether it is to protect your schedule, your sanity, or your wallet, the simple act of saying no often creates healthy boundaries in relationships with others.

In the personal finance world, one of the biggest problematic relational situations I see people get themselves in involves cosigning loans, or outright loaning money to friends and family. Obviously, when approached for a loan from someone you care about, it is hard to turn them down. However, if you are not in the financial shape to help others then saying anything other than no is to put your own financial well-being at greater risk.

Personally, I don’t loan money to anyone because I don’t like the idea of creating debt for others. We worked hard to experience debt freedom, and the last thing I want to do is enable others to owe money – especially when I might have to be on the collecting end of that relationship.

So, instead of loaning money, I give it away (when appropriate, and when I can afford to). This is a little softer approach than flat out denying someone help, and allows us to help a loved one with no strings attached.

I encourage you to resolve to say no more often – to yourself and to others. Do not allow yourself to become over-committed by saying yes to everyone, because that leads to stress. It also makes you less effective at the few things you really do care about. Identify those few things that are most important to you, and build your “yes” responses around those, while blocking out other distractions.

Post by Frugal Dad

Is there something that really makes you angry?  I mean, something or someone who completely steams your tea?

If so, consider yourself lucky.  You have an amazing opportunity.

I know this might sound crazy but (at least, in my case) an old resentment turned into a huge opportunity and one I never saw coming.

Before I go into the details, I have to give you some background.

When I was in college, I played snare drum in the school marching band.  Even though the drum weighed heavy on my shoulder and the drills took hours and hours of practice in the scorching sun, there were perks.

After all, who says “no” to dressing up like a complete moron and marching around in front of 30,000 people on Friday night?  Those other poor fellows who were busy guzzling beer at the fraternity house didn’t know what they were missing…..poor saps.

As thrilling as the marching band was, I started getting ticked off soon after football season began.  I was angry that the team got all the glory.  What did the lowly drummer boy get?  Nada.

As each game passed, I become more and more irritated.

The players got first-class treatment all the time.  They traveled to exotic places like Hawaii.  I went to Barstow.

They got their own special meals.  I ate Frosted Flakes.

They got special parking spots for their cool rides.  I bought a 10-speed.

And do I need to mention who met all the women?  Here’s a hint…..it wasn’t me.

I suffered through the football season and basketball season.  Then, I hung up my marching band uniform for good.

But while I turned in my sticks, I held on to my resentments.

As a matter of fact, I didn’t attend another college football game for 30 years.

That all changed last weekend and this is where I discovered a great opening.

For a variety of reasons, I found myself sitting in the old stadium watching my alma mater kick the tar out of New Mexico State.  I enjoyed it.

Oh….I’m not talking about the game.  I could have cared less about that. What I really loved seeing was the marching band again. There they were. The uniform design was exactly the same as it had been 30 years ago.

But I noticed something very strange.

Those uniforms looked beautiful to me.

These kids didn’t look dumb in their uniforms at all.  They were cool.  And they were having a great time – probably more fun than the players.  The band was rocking out, jumping around, laughing.

This was far different from what the players were going through.  Even though my team was winning, I could hear the crack of one helmet on another just like the sound my teeth used to make on those oh-so crunchy Frosted Flakes of yesterday.  Yikers.  That had to hurt.

Exactly at that moment, my resentments disappeared.   I realized how fortunate I was to have been in the marching band.

I remembered that I did have good times a plenty while I was marching around out there in the hot sun.  I made good friends and I got to play music.  Another bonus was that there weren’t any 300 pound gorillas chasing after me trying to turn me into a pancake.  And from a practical standpoint, I was able to graduate college in 4 years because of my participation in the band.

Besides all that, nobody forced me to play.  I could have quit anytime I wanted to.

Yes, I had a lot to be grateful for.  I never had any reason to resent anything about it.

Why didn’t I see this while I was in school?

What an opportunity I missed.  Rather than enjoy more of my time in the band, I resented the players for having the perks they got.  What a shame. What a waste.

I was a bit ashamed of myself.

What did my resentment cost me?

I wasted precious time in anger.  It cost me a lot of life.

As hard as I try, I can’t think of any way this rotten behavior cost me financially.  Yet it’s still relevant to you as a personal finance enthusiast.

Why?

Because, if you are like me…you aren’t after more money for money’s sake.  My guess is that you want to improve your financial life because you want to have…well….more life.

My guess is that you want more freedom and happiness.  That’s why money is interesting and important to you.

Well….what I’m talking about is a way for you to have that and it won’t cost you a penny. You don’t have to buy any books or tapes.  You won’t have to go to any weekend seminars either.  So what do you have to do?

It’s simple.  You have to get rid of your resentments.

While this may seem like a tall order, I think there are a few tools you can use to make this a simple task:

1. Write down all the things you resent.  What really ticks you off?
Your boss?
Your husband?  Kids?  In-Laws?
The Government?
That you don’t live in Malibu?
That the Beatles broke up 40 years ago?  What is it that boils your oil?  Write it down.

Now, as terrible as these things are, consider for a moment if there weren’t any silver linings in those dark clouds. Have any of the things you resent so much really been a blessing in disguise?  For example, let’s say you lost a great job several years ago because your boss, Eric Slick, was dishonest and blamed his mistakes on you.

Did anything good come out of it?  Did you find a better job?  Did you meet some great people?  Do you have a better working situation now?  Surely something good came out of it.  If you can’t come up with something, pretend you are interviewing a friend who went through what you did.  What silver lining would you point out to you friend?

2. Write it all down. It won’t do you much good if you only have this conversation in your head.  I’ve found that writing has some magical connection that allows me to really get value from these kinds of exercises.

3.  Write a thank you letter to the person, place or thing expressing gratitude for the new gifts you reaped. Don’t worry, you’re not going to mail this letter – ever.  It’s just a way for you to really bring the message home – to yourself.

This exercise helped me so much.  Living with anger is such a damn waste.  It’s a terrible way to live.  Have you held on to resentments too long?  Did it have a financial cost? What other ways did it cost you?  How did you finally overcome those old resentments?  How did it change your life?

Post by Frugal Dad

You probably don’t suck at anything….but your mind tells you that you do.

I just finished reading Adam Baker’s great post on How To Not Suck at Blogging.  Besides being a great read, it inspired me.

Just as Adam laid down some rules any blogger can use to “not suck” at blogging, I believe there are certain tools you can use to have a “suck free” experience while you are here on this planet – even if you aren’t a blogger.

The first and most important rule is this:

1.  You Only Suck If You Tell Yourself You Suck

Be honest.  Besides your teenage kids, when is the last time anyone said to you, “You suck”?   Unless you are still in high school or are a full-time Hells Angel, my guess is, it’s been a very long time.

In fact, I’ll bet the last person who told you this…was you.  Am I right?

For some terrible reason we are very proficient at treating ourselves worse than our worst enemy would – if we had an enemy (which we probably don’t).

I don’t know where this comes from and I don’t give a damn anymore.  I am officially declaring war on attacking anyone from here on…so Neal won’t be attacking Neal anymore.

Your Solution:

If you find yourself attacking yourself with negative crap talk, write down 5 reasons why you love yourself and then call somebody and tell them.  Be brave.  I know this is a hard thing to do but I will absolutely guarantee that the negative thoughts will stop if you take this action.

2. Stop Comparing Yourself to Anyone

My dad always told me that the only thing that really matters in life is trying your hardest.  If you do that, you are successful.

This makes sense.  If I’ve tried my hardest, what more can I do?

So why is it that I compare myself to others despite already having put in my best efforts?  I’m sick of it.  I’m declaring war on that too.

By any objective measurement, there is no part of my life that sucks.

• I have the family that I literally dreamed of having when I was a kid.
• I have a fine business that serves great people and provides for my family.
• I have time to write my blog and I’ve received some nice responses to what I write.
• I am healthy.
• I get to play music with some very cool people.

What sucks about that?  Nothing.

Yet I’ve barraged myself with negative self-talk for years on almost all the blessings I have.  And of course the easiest way to hurt myself is to compare myself to others.

Let me give you a few examples;

When I compare myself to other business owners, I ask myself why I’m not doing as well as some other friends in my industry.  Rather than be grateful for still having a profitable business, I find a way to put myself down by comparing myself to others.

In terms of my body, I’m not obese but I’d like to lose about 20 pounds.  Rather than be thankful for the problems I have, I compare myself to the Brad Pitts of the world and lament my bad fortune.

Music. I am not an accomplished musician but I play well and get to play with some great musicians.  They keep calling me back so I must be doing something right.  Yet when I listen to the radio and hear kids half my age doing things on the drums that I can’t even understand, I tell myself that I have no talent.  Why?    In college, I even stopped playing for 10 years because when I got there, I met players who were so much better than I was.  What a shame and waste.

Am I the only person who does this?  Nope.

I’ll never forget the time I spent an hour with a super rich and successful buddy of mine. Believe it or not, this cat makes over $1 million a month!  Do you think he’s happy about it?

He isn’t.  He told me how much money his buddies from law school make and was feeling sorry for himself.

REALLY? 

REALLY?

Your Solution:

You’re making it all about you…and it’s not.

You’re spending too much time in your head and it’s getting boring.  Here’s an idea – do something for somebody else. Don’t wait to “want “ to be of service…..just do something despite how you feel about it.  This can be as involved or as simple as you want.

Here are a few quick ideas you can do right now:

• Go read a book to your kid.
• Go take a walk around your neighborhood and pick up trash.
• Ask your spouse if he’d like a back rub (are you reading this honey?)

3. Create Humility

One of my favorite people in the world explained that humility means being on the same level with everyone.  Not better. Not worse.  The same.  If you tell yourself you suck at something that implies that someone else is better at it (which may be true) and therefore better than you (which is certainly not true). 

So let someone – or everyone be better than you are at some activity.  Just because someone else does something better than you, it doesn’t mean you suck.  Who cares?  Why let that mean anything?  Understand that the only person who gives that fact any credibility at all is you.  Stop it.  Right now.

Your Solution

My experience tells me that the solution for lack of humility is spiritual in nature.  It’s asking for help from a higher power.  However, I believe there are practical things you can do to solve this as well.

When you lack humility, you lack self esteem.  Do estimable acts.  Things that prove to yourself that you aren’t worthless.  You might have years and years of practice telling yourself what a piece of crap you are so this is going to take work.

But believe me, if you do estimable acts over a long enough time, sooner or later, the evidence is going to pile up and you’ll have more self-esteem.  You won’t be looking around for evidence to support that notion that you suck because you’ll know that you don’t.

4.  Get a New Currency In Your Life

We measure our success in life by how thin we are, how many readers we have for our blog, how big our house or apartment is (or isn’t), how much money we have, how much we travel etc. 

It’s very “me” based and it turns “me” off.

It’s a system designed to perpetuate misery.  There will always be someone who is smarter, better or faster.  Always.

When I was in junior high school, I remember reading about a tribe in Africa that measured their wealth by what they gave away rather than by what they had.  This story had a huge impact on me.

What if all our running around trying to have “more” is wrong?  What if it doesn’t mean anything.  I can tell you from working with people and money for the last 25 years, nobody has ever said that their greatest achievements in life had anything to do with money. Nobody.

What if our true wealth is derived from how much we try to help others?  Close your eyes and imagine that for just a minute.

When you do…it’s really hard to have the “I suck” conversation with yourself….isn’t it?

5. Bonus Solution – Laugh at Yourself

I hate to tell you this but in less than 100 years, you and I will be dust. 

Let’s enjoy the time we have.  Even if we are a klutz or not great at volleyball, who cares?  So what if you aren’t Angelina or Brad?  Who cares if you aren’t Bill Gates or Madam Currie?  It sure won’t matter in 100 years.  It probably won’t matter in 100 days.  Actually, it probably doesn’t matter now.

As long as you try your hardest, you can’t possibly suck at anything.  You may not do something as well as others, but that doesn’t mean you can’t be proud of yourself for your best efforts.  Believe me, I’d rather be around a person who tries her very hardest with modest results than a person who doesn’t put any effort in and seems to have everything flow his way.  Wouldn’t you?

Post by Frugal Dad

What Is “Destination Addiction?”

During the interview segment of the show, Dr. Holden introduced an affliction he referred to as “destination addiction.”  Millions suffer from it, and the symptoms include using words like more, next, and there.  As in, “If I only had more I’d be happy,” or “I can’t wait to buy my next car.”  The problem is that when we arrive “there,” wherever or whatever that is, we find that it is never enough to satisfy us.  Off we go striving for something bigger and better.

It is this never-ending pursuit of happiness that drives us to spend more and more money on things.  But things do not bring joy.  Things bring worry.  Things bring temporary happiness that masks some deeper pain.  For instance, those who consider themselves “emotional spenders” don’t really have a spending problem.  They are using shopping as a way of putting on an emotional band-aid to make some other kind of pain go away, much in the same way someone who overeats does so to combat depression, or loneliness.  It usually isn’t about the enjoyment of overindulging in foods, or purses.

Destination Dealers

How has this addiction spread so quickly?  Mostly with the assistance of “destination dealers.”  You’ve seen these folks on television pitching a product that will “totally change your life” or “make you happier than you ever dreamed possible.”  Cars are often depicted as the path to a happier life in commercials, as if the built-in navigation system, iPod docking station, and push-button ignition will really make you happier than the $600 monthly payments.  But, we get hooked at an early age and chase these various “destinations” our entire lives.  A bigger home, a newer car, fancier clothing, more exquisite jewelry–nothing is ever simply enough.

Home Remedies

Fortunately, there is an excellent home remedy for destination addiction, but it is often hard to find.  Contentment.  When we declare ourselves content with what we have and who we are we can beat the addiction of waiting to be happy.  We can live quite happily in the now.  Through contentment we can be happy with this house, and this car, and these clothes, and beat the cravings for more.

Back to Dr. Holden’s theory on happiness, which I found both thought-provoking and inspiring.  The pursuit of happiness, while declared as important as life and liberty by our country’s founders, is a bit of fallacy.  For happiness comes from within; it is not something that can be pursued.  As Dr. Holden put it on the show (I’m paraphrasing), “If we think of happiness as something external, that we have to pursue, we will chase it forever.  Instead, we must first be happy and then go out into the world.”

Post by Frugal Dad

It didn’t take long to hear stories from fellow patient’s families who were there watching their loved ones fight to regain their physical and mental abilities. Many patients are young (the center’s average patient age is 34), and it is sad to see so many people with their entire lives ahead of them cut down by an injury or illness. It is also inspiring to watch the human spirit overcome amazing difficulties to restore health to those often not given much of a chance.

The entire experience of nearly losing my mom at 53 years young, watching her fight to regain things we take for granted (sitting up, swallowing, talking, etc.), and now meeting dozens of other people going through similar challenges, has had a profound effect on me. It is rare that a day goes by that I don’t stop to reflect on the things I have to be thankful for.

I know it is a couple weeks early to give thanks for all the blessing in my life, but I felt like sharing them with you now. Some are related to finances, some are not. All are things I wish we would all do a better job of appreciating, while putting aside our own petty differences and problems.

Be thankful for the roof over your head. I don’t care if that roof is rented, mortgaged, or paid for, if it keeps you dry and warm at night you ought to be thankful to have it.  It might not be the roof you want, or you might want a bigger roof, but at least it provides some shelter against the elements. If you are not grateful for the roof over your head, drive around the downtown area of any major city in the country and look at the lines filling up for shelters, or those making “homes” from boxes and beds of newspapers.

I’m grateful for my health. Sure, I could stand to lose a few pounds. My shoulder still gives me trouble two years after rotator cuff surgery, and my back aches occasionally from an old football injury. But I am able to walk, talk, work, care for myself, and care for those I love. Our health is definitely something we take for granted until we lose it.

I am blessed to have an income. I have to wonder if the people I’m encountering at the rehabilitation center will ever return to their careers. In fact, my mom’s own ability to return to her previous job remains in question. Without an emergency fund in place, and/or a short-term disability policy, those who are unable to return to their jobs are basically without an income for months until a long-term disability plan kicks in.  Even then, they only earn a fraction of what they did prior to their injury or illness. This can be financially devastating to a family, and is a good reminder to shop a short-term disability plan and beef up your emergency fund, just in case.

I am lucky to have a window in my office. I worked six years in a cube farm before taking my current job, and spent the first two years at my current employer working in a storage area with no view to speak of. At least I could get up and walk to the front door,and I could see the outside world during my commute.  My mom spent 45 days in neurological ICU, and 17 days in a “step-down” unit before being transported by ambulance to the rehabilitation hospital. Her exit from the back of the ambulance was the first time she saw sunshine in 62 days. Take a minute and look out the window nearest you. Have an appreciation for the things you see–birds, squirrels, grass, blue sky, rain, sunshine, flowers, trees, etc.

I am most thankful for my wife and children. While my mom was in neuro-ICU she was unable to see her grandkids for over six weeks. My kids talked to or saw their “Grandma” every single day of their lives, and keeping them apart for six weeks was heartbreaking. Fortunately, Mom doesn’t remember much of that time, but I do, and I remember my kids crying each night as I returned home from the hospital and told them they still couldn’t go see Grandma. It is a reminder that we should never again take for granted time spent with our loved ones.

Finally, I am grateful for all of you. If you would have told me a year ago that I would start a blog, and have the opportunity to share my daily thoughts with 4,000 subscribers (and thousands of visitors), I would have never believed it. It has been a blast (virtually) meeting so many wonderful people who share a similar philosophy (and a few that don’t), and I’m grateful for the opportunity to interact with you on a daily basis. I hope you get half the enjoyment from reading this blog as I get writing it. My only regret is that I didn’t start it earlier.

We spend a lot of time here at Frugal Dad discussing sacrifices, proudly sharing the things we’ve given up to lead more frugal lives.  But every now and then we should all stop and reflect on the things that we do have. I’d encourage you to take a moment today to list a few things you are most thankful for, and feel free to share them with us in the comments below.

Post by Frugal Dad

Patience is a Virtue Our Society Does Not Have

I’m not exactly sure what, or who, is to blame for our collective impatience, but we’ve become an on-demand society in a lot of ways.  Instant communication and instant gratification have made the notion of patience a dated idea.  I’m often reminded of stories from my grandfather when he was overseas serving in the Marines.  He wrote letters back and forth to my grandmother, and it usually took weeks for his letter to be received, and for her to send a reply.  Often times the items he wrote about were “overcome by events” by the time the response was received.

Fast forward to today.  International email takes only a few seconds to be transmitted thousands of miles.  Technology has improved many areas of our lives, but has also spoiled us.  No longer is it acceptable to wait very long for some piece of information.  No longer are we willing to wait for good news.

Health and Patience

As I mentioned, my Mom has faced some very serious health issues over the last few weeks.  While I would love for her to make an instant and full recovery, I know that it is not likely in the short term, and her recovery will probably take some time.  No amount of medicine, or technology, or advanced surgical techniques can speed up the healing process required.  It will just take some time.  And that is okay.  We will be patient, and will continue to take a long-term approach to her healing.

Wealth and Patience

The meltdown in the housing industry combined with a credit crunch, a war, an election year, increased fuel prices, and natural disasters have taken their toll on the financial markets.  Those reporting on the financial industry take the side of “doom-and-gloom” one minute, and then predict the beginning of a rebound the very next day if the markets bounce back up.  It is their job to provide a constant stream of analysis on the markets, but frankly I just don’t pay it that much attention.  I know that over time the markets will likely trend up.  And so I continue to contribute to retirement savings in the equities market.  I have the benefit of time on my side, and I will apply patience to my own investing strategy.

Patience is not something we are born with–remember screaming for that bottle when you were six months old?  However, patience is a virtue that is often reinforced when we are faced with circumstances beyond our control.  For instance, when nothing else matters but the healing of a loved one, you have some time to take a deep breath and think, “Wow, why was I in such a hurry all the time?”  You suddenly feel like that guy zipping along at 80mph to make the next business meeting when suddenly his car dies in a remote stretch of highway out of cell phone range.  It is only then that he is reminded of the lesson of patience–eventually someone will come along and provide some help to carry him on his way, but it may take a while.  That is sort of how I feel.  I know eventually we will all get through the rough times; it will just take a little patience.

Post by Frugal Dad

I’ve had the displeasure of knowing many, and over time I have heard my share of sob stories related to their personal finances. I recognize that some people are generally down on their luck, or going through a rough patch. Maybe they have faced a debilitating illness, or a job layoff, or some other tragic event that has derailed them from leading successful, productive lives. Those are not the people I am referring to when I attach the label “perpetual poor.”

Perpetual poor people have a language of their own – a way of speaking that almost immediately identifies them as members of this class. When kids are young and they use an inappropriate word parents remind them to “watch their language.” As adults we still need an occasional reminder when we utter a financial expletive. I recognize that the words that follow will likely step on some toes, so put on a pair of steel-toe boots and read on.

“The poor man just can’t get ahead”

Quite possibly my all-time favorite statement of those with a poor attitude. This one is often muttered by someone insecure in their own abilities, and lacking any aspiration to improve their lot in life. They go around knocking “rich” people, minimizing their efforts by insinuating that they are rich because they are lucky, or because their parents were rich.

In some cases, both may be true, but the average millionaire in America started with nothing and built a successful career through hard work, dedication and a never-ending willingness to acquire new knowledge. Remember, there are no financial Cinderellas.

How to identify members of this group:

• Can recite the last five winners of American Idle (that’s not a typo) from memory
• Haven’ t picked up a book since high school
• Never stretched to learn a new skill at work, but complain about being passed over for promotions

“We struggle just to make ends meet”

A close cousin of “poor man” who can’t get ahead, this group thinks it could get ahead if it weren’t for a variety of external forces holding them back. Rising gas prices, a shrinking economy, and the President of the United States all conspire to keep them down. They spend up to their income (and then some), save virtually nothing and frequently splurge on unnecessary items because “they deserve it” (see below).

How to identify members of this group:

• They can frequently be spotted moving about new car lots on Sunday afternoons leaving a trail of drool in their wake
• Convenience stores are a hot spot for picking up the weekly supply of beer and cigarettes
• Several times a year their habitats go dark while they retreat to the nearest beach for a much-deserved break

“Everyone has a car payment – it is a fact of life”

Speaking of new car lots, if you manage to run across a member of the perpetual poor species here and asked them to justify their presence you’ll hear that everyone has to have a car payment. They are too expensive to buy with cash! That may be the smartest thing these types will ever admit. New cars are too expensive to buy with cash, that’s why I choose to buy used cars in good mechanical condition and drive them until the lug nuts fall off.

How to identify members of this group:

• The easiest way to spot members of this group is to look around parking lots at crowded shopping malls. They usually park at least 100ft from the building and perpendicular to the parking spot’s stripes, making sure to take up three spots. This is to lessen the chances of dings from car doors and shopping carts. After all, they pay nearly as much for this automobile as they do for their homes so it makes sense to protect such an “investment.”
• Revving engines, sunburned foreheads in convertibles and Mercedes symbol key chains are other common signs

“The only way to get rich in America is to hit the lottery”

Another personal favorite of mine. The lottery is effectively a government sponsored tax on poor people. Don’t believe me? Check out lottery sales by zip code of any participating state and you will discover that the majority of lottery tickets are sold in the poorest sections of town.

It is no secret, really. If you are ever around a gas station on Friday night you see them lined up at the counter forking over $20 of their hard-earned paycheck for their chance at financial glory. And just try telling them that $20 a week in a mutual fund averaging 8% growth for 30 years adds up to $130,000. Who can afford to invest in mutual funds?

How to identify members of this group:

• Frequently spotted at convenience stores, bingo halls and anywhere video poker is allowed
• Usually absent one week out of the year for the annual pilgrimage to Las Vegas, Biloxi or Atlantic City
• Excluded from this category: Otherwise financially independent individuals who play the lottery, or bingo as a hobby

“I work hard so I deserve it”

One of the most common statements of the perpetual poor class. These people typically do work hard, but believe their lavish lifestyles are justified because they are such hard workers, as if no one else is out here hustling for a dollar. Perhaps if they “deserved” less they wouldn’t have to work so hard.

The fact is there have been many before you, and many who will come after, who have worked much harder, for much longer periods of time without ever getting a break or a material reward. My great-grandmother raised nine children during the depression era, hand-washing cloth diapers for twenty-two years in a row, preparing meals for eleven people from scratch (and not much scratch to work with), and ironing by candle light late into the night. Sitting in an air conditioned office all day playing with computers would have seemed like a vacation to her.

How to identify members of this group:

• Often seen double parked in front of a Best Buy store trying to squeeze a 52″ plasma television into their hatchback.
• Male species frequently spotted driving huge pickup trucks with six tires, dual exhaust, and an ATV loaded in the back.

“You Can’t Take It With You”

A review of the lifetime earnings statement of this class of perpetual poor would reveal lifetime spending well in excess of lifetime earnings, leaving nothing saved for a rainy day or a future retirement. They expect to work late and die young, leaving little reason to save for their golden years. If they should happen to be forced to retire early they will live on social insecurity, complaining about the benefits all the while.

No, we can’t take it with us, but we can be responsible adults and save to support our future selves rather than being a financial burden to our loved ones. We can also use the opportunity to help our loved ones, who will become our legacy, get on solid financial footing and continue the tradition of passing generational wealth to the new branches of our family tree.

How to identify members of this group:

• Savings account balance: $52.29
• Retirement Funds: $0.00 (cashed it out after leaving last job to pay off credit card debt)
• Life insurance coverage: $0.00 – can’t afford the premiums

At various points in my life I have probably been a member of each of the above classes, which inherently qualifies me to make fun of them. However, if you find yourself a member of one of the these perpetual poor classes it doesn’t have to be a permanent diagnosis. It is possible to overcome a perpetual poor mentality, but it involves some heavy-duty lifting on our part to rise above our circumstances. It also takes a complete attitude overhaul, so watch your language!

Post by Frugal Dad