We would all love to be millionaires. But let's face it, most people never make it that far. Most of us stall somewhere around the middle class. And that's not too bad considering the fact that half of the world's population lives in poverty.
Our culture values money and possessions -- almost to the extreme. This fosters a 'keeping up with the Joneses' (or Kardashians) kind of mentality. People want to be rich -- or at least look like they are rich. Because of this, many people make irresponsible choices when it comes to their finances, and many of them make excuses for it. Here are eight of them that I have witnessed from many people:
1. I can just live off of credit cards.
You do realize that at some point you will have to pay that money back, right? And you will probably have such a huge balance that you will never pay it off. So then you might think, "Well then I can just declare bankruptcy. No big deal." Well, guess what? Not only does bankruptcy ruin your credit for a very long time, the debt just doesn't magically disappear. Someone pays for it. And who is that? The rest of us. The companies you don't pay will have to raise their prices to make up for the loss -- higher prices that we all have to pay. Or maybe taxpayer money will go into paying off your debt. However it works, it all comes down to one thing: not taking personal responsibility.
2. I need to impress everyone.
This is deadly. As I said in the opening paragraph, many people do have this need. However, what is the point? Just because you don't live in a huge house or drive a fancy car doesn't mean that you aren't successful. In fact, I bet most of the people who do own all the 'rich-looking' stuff are really drowning in debt. Wouldn't it be better to live in a modest house and drive an average car knowing that you can sleep at night because you are not drowning in debt? I think that sounds like a better option.
3. I always scream, "YOLO!!!!" (You Only Live Once).
I'm not sure if most adults have heard this 'Yolo' term, but it's one that kids tend to be using these days: "You only live once!" And that is true (unless you believe in reincarnation). But while that term implies living life to the fullest and embracing the moment, that way of thinking can get you into trouble of you don't think about the consequences of your actions. If you rack up a pile of debt so big that you will have to spend the next 10 lifetimes paying it back, well, maybe you shouldn't 'live in the moment' quite so much.
4. I can't invest my money -- I might lose it because it's too risky.
Many people are scared to invest money - it's almost like we're wired that way. True, any investment is risky. However, if you are investing for retirement or for your children's college tuition, then that is a very good reason to take the plunge. As the saying goes, "Nothing ventured, nothing gained!" So if you are avoiding a strategy that could grow your money into a nest egg in the future, then maybe you should rethink your actions.
5. I don't think money is important.
If you're thinking, "Money isn't everything!" then you are probably being financially irresponsible. Of course money is important! But if you think that it isn't, then you have an attitude of carelessness. If you don't think money is important, then you won't pay attention to how or where you spend it. And this lack of attention will get you into trouble.
6. I'm already in a ton of debt, so what's a little more?
That attitude is what got you into the mountain of debt in the first place. Little by little, one small purchase after another adds up to one big mess. It's kind of like eating a whole birthday cake in one day, bite by bite. Each bite seems harmless. But as you slowly eat your way through the whole cake, suddenly you ate just that -- a whole cake. Remember that each step along the way stacks on top of the last and eventually they add up.
7. I deserve to have nice things.
Many people think things like this, "I work really hard, so I deserve to have the best!" So, they go out and buy things they can't afford. For example, I know a guy who always had to have the "coolest" and "most expensive" car because he wanted the best. But guess what? Eventually, his finances got to the point where he had to downsize everything. So if you are like him, it might be best to start out small before you end up in financial ruin like he did. It would be as easy as doing something like buying a reasonable used car. You can do some simple research using a car buying guide and find one that would be just as nice but with a much lower price tag.
8. I like to buy things on credit because I can take a long time to pay them off.
This is like the 'lay away' mentality, but you actually get to enjoy the thing you bought. Yes, a house usually takes 30 years for most people to pay off. Cars take around five years. Those are normal purchases that we expect to have to pay over time. However, those are necessities. Some things you buy probably aren't. If you find yourself thinking, "Hey, it might cost $5,000, but the payment plan says I only have to pay $20 a month...so apparently I can afford it!" Well, maybe you really can't.
Financial responsibility is really the same as personal responsibility. You just need to be self-aware enough to know that your actions have consequences, not only for yourself, but for other people as well.