..economics 101..

4

October 21, 2008 by Jo

Seems like the world is coming to an end with all of these economy troubles. I suppose I should count myself blessed (and I do, everyday) that I’m in the non-profit industry and that my Jeff is self-employed in a field that’s almost always necessary to modern day business.

But let’s say we weren’t. Let’s just assume, for one minute, that we were a couple with 2 kids and worked in different arenas where the economic distress is a huge threat to our jobs.

Do you think we’d buy a new house? Or a new car? Or eat out ALL THE TIME? Or buy new clothes, makeup, shoes, etc. that wasn’t necessary? Do you think we’d make REALLY STUPID FINANCIAL DECISIONS and then claim the economy led to our own, personal downfall?

Nope. We simply wouldn’t.

I suppose that is what it is…people will be the cause of their own problems 99.9% of the time and then find someone or thing else to blame.

As we’ve watched the country rock one way and roll another financially, Jeff and I are doing our best to scrimp and save where needed. We BUDGET the money to spend so it’s OK if we spend the money we budget. I can buy clothes I feel like I need (like a new dress for an upcoming dinner) because I know we have a certain, set amount of money that’s BUDGETED to be spent…ON CLOTHES. Some months, we won’t have that money. And…TA-DA! We won’t spend it! And we also won’t complain about the economy and how we’re ruined. Because we’re not. We’ve got a house (that we’re not renting, thank you very much), two running cars, everything we need for Jeff’s business. We eat well, have our weekly date nights, spend money on the kids if we want. We’ve got savings in hand and in the bank.

Sure, I know the economy is going downhill fast. But I also know that so many of the people really hurt in this aren’t the little guys (especially now that gas prices have fallen again)…and yet the little guys are the ones playing the martyr. I know plenty, and yes I said PLENTY of young couples, with families, who are doing just fine financially because they don’t make dumb decisions and they scrimp and save when necessary.

That brings me to my other point; what got us in this mess? And of the few “main street”-ers who are truly suffering how many got there by no fault of their own?

I don’t have the answers…but I do know that stewardship probably has A LOT to do with it.

What do you think?

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4 thoughts on “..economics 101..

  1. lynds says:

    Actually when the economy is suffering the worst thing people can do is “save” their money. Obviously, if everyone sits at home and piles cash in their freezer, the economy is only going to get worse. It’s so funny how when things tighten up in the mortgage and loan industry, even people who don’t have large debt end up stashing their money away for fear of “hard times”. Well, not spending any money is certainly going to have negative effects on our economy! You’re actually making hard times worse! And those dollars you are “saving” aren’t going to be worth as much 6 months from now. Investing in things that hold their value or appreciate, like a house or fine jewelry is a better option. Or putting your money into an account that will earn interest but not be lost when the stock market inevitably falls. Even buying a new car is better for the economy, and it is also great for your credit history IF you can afford the car you’re buying (of course a lot of people can’t and buy it anyway). Sure, saving along the way is always the best thing to do, but just halting all “unnecessary” spending isn’t going to get us out of this any faster. You’re right on about budgeting- everyone should factor in those little must-haves so that they can know what want-to-haves they can afford! We don’t make a lot of money but we have been very careful to budget from day one and now we are able to put a quarter of every paycheck into our savings and leave it completely untouched! We live off the rest like it’s all we have… and owning a small business, if you do it right, has great rewards as well. You don’t really make any money owning a business (you don’t want to- if you do the IRS takes half!!), but the benefits (cell phone, travel, health insurance, car!) really do have a dollar value for us! I think there is a happy medium between living beyond your means and being totally Dave Ramsey (he’ll tell you himself he couldn’t get a loan right now even though he’s a millionaire because he doesn’t have enough credit history) and you and Jeff seem to have found it. It’s not hard to get what you want if you are being reasonable and you plan ahead. Sometimes you have to wait, sometimes you can do it when you want to- but if you make smart choices today it will be so much easier to buy a house or a car or have a baby or buy that pair of shoes tomorrow… Why don’t people get that?? :o)

  2. Jo says:

    Lynds, while I understand allll that you said, my point was that the people who blame their hardships on the economy are the same people who make NO effort to control their spending. They make really dumb choices and then want to put the blame somewhere. I wasn’t trying to say anymore than just that…that those self-martyrs should get the heck over it.

    But thanks for the money sermon anyway. I didn’t know you were such an expert. 😉 Love you!

  3. lynds says:

    wow, you asked “what do you think?” guess you didn’t really want a response. ;o)

    never said i was an expert! but i’m not broke either, and my business is making more than last year… can’t ask for more.

  4. Jo says:

    I should’ve been clearer; I wanted a response about my post, which was in regards to how people are getting themselves into their financial messes, not the government. Which I suppose you gave in the end with your statement about making smart choices today…I just didn’t expect SO MUCH of a response. But I’m glad you shared about your position about money, most (if not all) of which I agree with!

    Oh, and I was serious about the expert comment…you know a lot more about money than most people your age! 🙂 And I’m proud of you for that!

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