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Money and the people who spend it

For the fun of it, I looked at the labels I have used for various posts. Money was number 2, well ahead of most others, other than football, which was a close second. {Kids was the runaway label winner, more than double that of money. I am speculating, however, that the kids posts are as much if not more about kids in general, thanks to my teaching, as they are about my kid.}

Money. I have so much to say about the subject, but as with many things in my life, it confounds me.

I read mostly useless financial advice from various sources. I can't imagine too many people don't realize that they could save money by not going to Starbucks every day or by forgoing the water in plastic bottles. And, duh, who does not know that it is more expensive to go out to eat or go see a movie versus cooking at home or renting a movie?!

Yes, I am aware that I should be contributing money to a 401k, something I did as soon as I was able to at my first job and continued to up until my last month at my last job. But I don't have a full-time/steady job now, and I just can't justify putting money into an IRA when I have bills to pay. But is scary, knowing that social security will probably be a memory in another 30 years.

Every month I get my car payment statement. I could pay the car off, and considering the .22 percent I am earning in interest in my savings account (well ahead of the .01 percent I earn in my checking!), it is probably not a bad idea. But I am paying no interest on my car payment loan, so it is hard to justify taking that money out of savings when I may very well need it for something. Like a new roof, which might be double what I owe on my car.

And just who are these lower interest rates helping? Seriously, what it is the point of earning .01 percent interest? If Brian and I could have benefited from the lower interest rates via refinancing, I probably could have stomached the paltry savings rates. But we could not justify the outrageous closing costs; I can't assume we will still be here in five years to be able to recoup them.

I know a couple who is so concerned about the value of a dollar that they have no money in savings and no 401k; they think money will be worthless in a few years, so why bother. Are they crazy or soothsayers?

Can't we choose to spend our money however we like? Is it wrong that a movie star or pro athlete owns a 10 million dollar house or buys a dress or suit that costs thousands of dollars and is worn only once? Should anyone really be making that much money to begin with? Or is it okay because people (i.e., fans) are willing to spend their money on tickets, clothing, etc., to basically bankroll these stars?

How about the Wall Street banker? And the bailouts in general?

Should we be mad that UPMC is spending 16 million dollars on a new ad campaign, particularly considering the high cost of health care?

I would really love to hear your thoughts on the money people make and how people in general spend their money. I am on the fence, really. Torn between thinking if people fall into money by hard work or luck, more power to them, but feeling that people are kind of self-centered and greedy if they need all those material things.

And you?

Comments

Sherri said…
I'm on the fence about a lot of things regarding money. I, myself, am frugal about some things (have a strict grocery budget - plan what clothes my kids need - don't do expensive haircuts, etc. anymore....), but I also like to splurge now and then on some really cool boots or a great night out to dinner or... yes, I'm guilty .... my Starbucks holiday drinks. I grew up upper middle class but with a very frugal mother and a self-made Dad (first in his family to attend college - became big deal executive in his company ;-), and.... my brothers are pretty spoiled - not great with money. Hubby and I have put a lot away for college - for retirement, etc. We are careful with home improvement, but we do take nice vacations - that kind of thing. Have to say.... once my humble Dad did make money, he did enjoy nice clothes and cars, expensive cigars, etc. BUT he despised braggarts or people completely focused on the material. My hubby, on the other hand, grew up upper middle class until his hard-working physician father sadly passed away, then... his mother, who had grown up poor on a farm in third world country was in charge. She was not good with money, and he and his siblings worried constantly about it. She would take them to Europe or to Peru for the summer, but then would have no money for groceries or condo rent, and went through all of their college money. To this day, however, she places HUGE value on people who are "rich" and likes to make comments to others about how little they make. Strange. Oddly,hubby and I do share, basically, the same philosophy on spending and saving. In a nutshell, I do not like to see excessive spending by individuals or corporations, AND I think financial planning for the future is VERY important. Interesting post...
Bill Applegate said…
I will be honest…I like to spend money…I do. With that being said I also like to SAVE money. I take a great deal of pride in NOT living above my means. I have contributed to my 401k since I started working out of college. Once the kids arrived we opened a 529 for them before they were 6 months old and started saving money for their education. I am a big believer in being fiscally responsible and living within your means.

We bought a nice decent size house…sure we could have bought a monster sized house, but that comes along with monster mortgage payment and bills. Saving money is hard, but a MUST in my opinion. I have lectured other family members and some friends on it and they just don’t want to hear it. I grew up typical middle class and worked my butt off to go to college and give myself opportunities to reach a different level. Sure I blow away my budget and spoil the kids and myself from time to time, but ONLY AFTER ALL the bills are paid, my 401k and 529 contributions are made. Saving is very important in my opinion.
Facie said…
Thanks for your comments, Sherri and Bill. What you are both doing is responsible and reasonable. When I Brian and I were both working full-time, we probably should have spent more money on ourselves. If you are saving, why not have fun, whether it means nice dinners, starbucks coffee, toys, whatever makes you happy.

What I am more undecided about is if it is necessary for anyone to live in a 10 million dollar house, spend 250k on a one-day wedding, or own 100s of $$$ outfits. It seems so hard to justify in these tough times. But it IS their money.

But I get equally frustrated when I read about people who have 1000s of $ in credit card debt and then take yearly vacations or spend lots of money. Even if you have no debt (other than house and maybe car payments), if you have nothing in savings, I just don't think you should be out having too much fun. Not saying no fun, though, because it is THEIR money (but then don't complain when you have a $500 car repair that you can't afford).
Anonymous said…
I dont think anyone needs a mansion with 14 bedrooms and 20 bathrooms, and the like. I just hope those people are generous with their moola, otherwise how can they sleep at night. Not that you asked but I say tax those $$$ people.
Facie said…
Anon, what do you mean by "tax those $$$ people."? If you are saying that people who make a lot of money should be taxed more, for the most part, I am against that. Never quite got why just b/c you make more money you should therefore have a higher percentage taken away. The more you make, the more Uncle Sam gets anyway.

Of course, most of the wealth is owned by a small percentage of people....
chris h. said…
My saving/spending is governed by fear: fear I won't have enough to pay bills/live on, so I save; fear I'll die without actually enjoying any of the money I work hard for, so I treat myself...but rarely.

Knowing me, I could be 80 with tons of money and still be afraid to spend because, "you just never know." I have a hard time reconciling this with the truth that "you only live once." I'm sure I'm missing out on a lot of living and life experiences (travel, especially) that other, less fiscally concerned types are enjoying.

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