The Financial Equation: Don’t Spend More Than You Bring Home

This article title sounds so simple in theory, but it seems to be very difficult in today’s day and age to effectively put into practice.  Many people have become far too reliant on using credit to get the things that they want (notice I didn’t say the things that they need – big difference), instead of doing it the old-fashioned way:  saving up the money until you have enough to spend (whatever it may be).  What a novel idea, right?

Often, people spend themselves into debt because they’ve already spent the money before they’ve earned it.  This is financially dangerous and unhealthy (for a number of reasons), creating household money problems – which can lead to stress, arguments (unless you’re single; you only have yourself to blame then!), etc.  Living within your means should be the rule in the U.S.A., not the exception.

Unfortunately, our federal government (some states also) is not a good financial role model, as our country often spends way more than the tax dollars collected.  This leads to our government shutdowns (nonsensical) and complaining by both parties that the other is to blame for the mess our country is in (productive, right?) at that point in time.  I don’t want to get political, but this is an example of not taking responsibility for making tough choices on what is truly needed vs. what we want to do (I think the Rolling Stones said it best:  You can’t always get what you want).

Granted, the majority of jobs today don’t quite pay what they used to in the past (sorry if you currently can’t find work or are underemployed) but we all need to make a budget (yes, I know – the horror!) and actually live within that budget.  Many of us need to save money instead of spending every dollar before we even have it in our possession.  If you value your financial, mental, and physical health, you’ll get off the “spendaholic” cycle that many of us have become way too accustomed to and learn to make ends meet with what you have.  You owe it to your future self!

Find an experienced financial advisor who regularly counsels clients on spending issues, works for an RIA firm, earns his/her money from fees (NOT commissions), believes in having an abundance of investment choices for clients, and has the heart & demeanor of a teacher, NOT a salesman, and chances are you’ve found the right financial advisor to help you prepare and plan for your financial goals.

To learn more about Martin Federici, view his Paladin Registry profile.

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