Typically, middle-class people who are struggling financially think that things would be better if they only made more money.
There are cases where making more money helps immensely: usually when you’re making minimum wage or when you’re at or below the poverty line. In those situations even a 50 cent an hour raise can make a huge difference.
But if you’re already making a decent wage (or even a very good wage) and you are struggling financially, it’s probably not your income that’s the problem.
More income might be a good short term solution, but chances are you’ll just end up struggling again as you automatically adjust to that increased income.
In that situation, your problem is almost certainly your financial habits:
- Do you get a bonus or a tax refund, and go out and splurge?
- Do you get a raise, and start thinking of all the things you’ll be able to do now? (And then do them.)
- Do you pay off your car, and buy a new one?
- Do you lease a new car every couple of years?
- When your car breaks down, your house’s AC unit quits, or your relative dies, do you put the expenses on a credit card because you don’t have the money but feel like you have to do something about the situation?
- Do you buy a lot of books, DVDs, games (and their associated players), clothes, or restaurant meals all of the time?
- Do you carry a balance on your credit card(s)?
- Do you have a home equity loan?
Those are all financial habits that can leech away money, keep you from getting ahead, and (frequently) put you or keep you in debt.
Changing THOSE habits will make all the difference. And once you’ve done that, making more money is just icing on the cake.
This has been our excuse for years. Or at least mine. In fact we on the National average don’t make a great deal of money. But on a world average we do. Right now if we were debt free except for our house we would have over $2000.00 more to save, invest, spend. It is just disgusting that we have worked our selves into such a hole, by crying we don’t make enough so therefore the kids new school clothes can go on a credit card. Or lets take this vacation and charge it, after all the kids won’t be home forever. Never any money in savings for an emergency, and there was always an emergency. Well now we are changing those habits. We have actually had $1000.00 in an emergency fund for over 18months. Yes we have had to tap it but we brought it back up to $1000.00 Little by little our lives are changing, we do make enough money, we just have to spend it differently.
It’s a pretty common line of reasoning. But changing habits is much more effective than believing excuses!
I love your website Jackie! I have also had this mindset of not making enough money but like you speak of here, we have to change our habits and learn to pay off debt! Your website is encouraging to me to get my credit card balances wiped out to to start saving! I hate the feeling of having to work a job day after day just to continue paying minimums and supporting my mindless spending. I’m also trying to lose weight and it’s funny how these two are so similar with having to most of all, control your mentality and resist the urges.
I’m so glad to hear that! And I agree, losing weight and paying off debt have a lot in common.