| Ask a person what is the single most important thing | | | | world-famous brain surgery hospital you may be |
| that could happen to improve his or her financial | | | | already at the top of your game. You can't walk out |
| picture and the answer you'll get-in various | | | | and figure you'll work somewhere else, because |
| gradations-is a sudden influx of cash. Some of us | | | | there may not be a "somewhere else" for you. |
| wish for pay raises, others want to win the lottery, | | | | But you do have a lot of control over what you |
| and more indecisive types just dream of a sudden | | | | spend. |
| windfall of cash. | | | | Most Americans are mystified by that. They see |
| Take an average family in an average neighborhood | | | | debts and expenditures as things that "just happen." |
| in a small town that's earning, all together, about | | | | It's true that you have to pay rent, buy food, and |
| $60,000. Chances are that family is whining about | | | | pay your taxes, but you have some leeway in the |
| money and wishing, possibly even praying (if they live | | | | first two items. When it comes to entertainment, |
| in the Bible belt) that they can earn more money. | | | | clothing, and vacations, your control zooms off the |
| They probably even have an amount in mind. They | | | | charts. |
| whine and wail, oh, if only we could just manage to | | | | I've seen people spend money on things as if they |
| earn $70,000 a year, then we would be on easy | | | | were zombies. A family in five-figure debt took an |
| street! Even $68,500 would be enough! That would | | | | expensive vacation one year and ended up getting |
| be all it would take for us to be well off. | | | | dunned by collection agencies because they let some |
| Meanwhile right down the road is another family in | | | | of their already festering debt fall into worse arrears |
| the same general circumstances, and they're also | | | | than previously. When I asked them why they went |
| moaning and groaning about not having enough | | | | on an expensive vacation that year, they seemed |
| money. The thing is, this second family already earns | | | | stunned. |
| $70,000. But it's not enough. They need $80,000, | | | | "It was summer. We always go on vacation." |
| maybe even $85,000. | | | | Young women feel that it's their birthright to have |
| Whatever you earn, if you're strapped for cash right | | | | designer jeans and expensive handbags, not to |
| now, chances are pretty good that some people in | | | | mention big name shoes. College kids who wait tables |
| very similar circumstances to yours are doing just | | | | to buy books will put a spring break fling to Mexico |
| fine with the same amount you're earning. | | | | on plastic. Why not? They're entitled! |
| And whatever sum you're dreaming about ... wake up! | | | | That entitlement mystique has created the mistaken |
| There's somebody out there that fell into that much | | | | sense that our expenditures are uncontrollable. |
| money and is flirting with bankruptcy. | | | | They're not. |
| It's just as easy (maybe even easier) to go broke | | | | You can trim your budget by 10% easily, without |
| earning $100,000 a month as it is to go broke earning | | | | even feeling anything. Most of us can save even |
| $4,000 a month. | | | | more by making conscious decisions and adjustments. |
| If you're a typical American you probably wonder: | | | | And it's possible for zealots to cut expenses radically |
| how on earth can you go bankrupt if you bring in | | | | without giving up a decent lifestyle. |
| $100,000 a month? That's over a million a year!! How | | | | If you cut your expenses by 20% (a good target, |
| can you be anything but rich? | | | | by the way), that's like getting a 20% raise. You |
| You can go broke and it's not hard. Here's how. | | | | can't reasonably expect your company to give you a |
| Spend $101,000 a month. An extra $1,000 in | | | | 20% raise, but you can give one to yourself! |
| expenses can really creep in without being noticed | | | | What's more, frugality is not necessarily a program of |
| when a person has a large income. That's why so | | | | hideous deprivation and austerity. It can be creative, |
| many lottery winners and movie stars and the "silly | | | | engaging, and fun. It forces you to do things |
| rich" can wind up broke. When you only bring in | | | | differently and many people struggling with debt and |
| $4,000 a month, it's pretty hard to "make a mistake" | | | | "low incomes" are often struggling in other areas. |
| and spend $5,000 since you're probably counting your | | | | Here's what I mean. You may feel like your life is out |
| pennies. | | | | of control and you dream that a bigger income would |
| Your financial health is made up of two things. | | | | "fix things." But then you decide to start saving |
| Americans fixate on one of them and ignore the | | | | money. You give up cable TV and going to the |
| other. | | | | movies. This is going to force you and your family to |
| Part of your overall financial picture is your income. | | | | get together and actually interact with each other. |
| That's true. I don't want to underestimate it. Your | | | | You start playing ball in the park after work or board |
| income is vitally important. And don't get me | | | | games at night. |
| wrong-more is better when it comes to income. | | | | I've heard of restaurants-only couples who went on |
| But the other part of your overall financial picture is | | | | frugality plans who discovered that cooking at home |
| what you spend. This is where Americans get | | | | was not only fun, they ate healthier food. The couple |
| glassy-eyed and rub their foreheads. | | | | finds that homemade food is healthier, helps them |
| Most of us act like we have control over our | | | | lose weight, and they enjoy spending time together |
| incomes because we obsess about them and figure | | | | with their new hobby. There's another surprise, too. |
| out way out of debt based on income boosts. The | | | | They find it really doesn't take more time to cook |
| truth is, you don't have much control over your | | | | regularly than to drive to restaurants to eat out all of |
| income. | | | | the time. |
| Let's say you have a job. You really don't have much | | | | A desire for your to save money may be the |
| control of what kind of raise you'll get. You can do a | | | | catalyst that convinces you to try to learn to sew, |
| good job, but if the industry suffers a downturn or | | | | plant a vegetable garden, or bake your own bread ... |
| your boss doesn't like you or you make some career | | | | however, lots of folks wind up discovering that they |
| mistakes, you may not even get any raise. The old | | | | actually have fun doing these things. |
| adage that hard work will bring you rewards really | | | | Not only that, frugality is a good incentive to proper |
| didn't mean that working hard for a corporation | | | | work-life balance. Most of us get into the debt |
| guarantees you regular raises. You may not get | | | | whirlwind because we're living too much in the work |
| them. | | | | zone. (Work is expensive! It requires gas, clothing, |
| You might think you could just find another job. | | | | day care, and all sorts of special services to permit |
| That's true. But the kind of job you can get depends | | | | us to log those long hours.) Frugality is going to force |
| a lot on your education, skill set, and background as | | | | you to spend some time at the home front. |
| well as where you live and the competition to nab | | | | And when it saves you money, you realize you not |
| those elusively rare high-paying jobs. And let's face it, | | | | only can afford to spend more time at home with |
| at some point, you max out. If you're a | | | | the family, you can't afford not to. |
| world-famous brain surgeon working at a | | | | |