I met with a friend last night for dinner. She, like me, has new baby and has started working part time as a freelancer to save on daycare. She was bemoaning how she and her husband are broke and can't make it on one salary alone. They also aren't saving anything for their baby's college.
They have credit card debt. Two SUVs and two SUV car payments. Mortgage, etc. student loans too.
I know for a fact that her husband makes just as much as mine.
She thinks my family making it on one salary must only be possible because we don't have a mortgage. (we don't have one because after a long grueling Hurricane Katrina recovery, we sold our house for enough profit to buy a house in Ohio , because it's much cheaper to live here).
Well, it isn't true. Even when we lived in New Orleans, and had an exorbitant $2,000 a month mortgage and made less money than we do now, we still saved and had no debt. In Ohio, if we hadn't paid it off, our mortgage would only be about $750 a month.
I'm telling you, it isn't the mortgage. It's the other things: the car notes, the credit card debt. We don't have that. And sure, it isn't easy all the time to live with one beat up 11 year old car for two people and a baby, but we do it, because we don't like debt.
And yes, I'd like to have cable television and maybe some fancy clothes every once in a while, but when it comes time to shop, it just doesn't seem as important as putting money away for bean's college.
It's all the choices you make. Not how much you earn. Even when I was young and broke working as a waitress in the French Quarter, I managed to eventually save $10,000 in a ceramic piggy bank in my apartment. It's choices!
With this friend, it's like it's falling on deaf ears.
I guess it frustrates me. You really have more control than you think you do.
We chose to live in a smaller house in a less expensive neighborhood than they chose, we choose not to have two car payments. Why can't anyone see that?
I rue the day they found out our house was paid for!
We aren't rich, so shut up... a rant
August 12th, 2008 at 02:18 pm
August 12th, 2008 at 02:32 pm 1218551574
August 12th, 2008 at 02:38 pm 1218551914
August 12th, 2008 at 02:39 pm 1218551946
August 12th, 2008 at 02:44 pm 1218552280
I believe it simply boils down to the choices we make. You and your DH have made the choices that we were right for you. You don't need to keep up with the Joneses. Your friend obviously has. I have a brother who makes as much as my husband - but guess what we don't have a Lexus, didn't remodel our whole house at the same time, have expensive landscaping, wear Brooks Brothers clothing, etc. And we don't do Starbucks everyday or eat out two times a week. We don't have premium cable channels. Your friend is jealous that she didn't have the philosophy you did. What she thinks doesn't matter. You are doing a wonderful job for your family.
August 12th, 2008 at 02:58 pm 1218553125
We also moved somewhere significantly cheaper, precisely so we could live on one income.
Anyway, our financial ease mostly comes from knowing we don't have to have a $400k for a very small patch of land. As such, I find the culture very different here. They don't know what it's like to have to pay $400k for a condo (with the alternative of $1k/month rents for a studio apartment).
Obviously we're just rich.
What's mind boggling to me here is so many people I thought were REALLY broke come to me for financial or tax help and I realize instead of living on $30k/year as I imagined, they are living on $130k/year. (Keep in mind we were living on $50k when we had our first child).
A lot of people here make big money but don't have much to show for it. I have an acquaintance who drives modest cars and lives in a modest home and just admitted they are in danger of losing their home because they borrowed $200k against it and can no longer afford the payments. I have no idea what their incomes are, but they both work full-time.
Huh??? There is nothing they own they could sell to knock down that debt. I don't even understand where it all went. ??? But it's kind of the common story here.
It's not even the cars and fancy stuff. They spent it all on eating out and amusement parks. Seriously. It goes fast when you don't bother to rein it in at all.
August 12th, 2008 at 03:08 pm 1218553707
August 12th, 2008 at 03:09 pm 1218553787
August 12th, 2008 at 03:22 pm 1218554543
This friend I wrote about above also refuses to buy second-hand baby clothes. She shops at neiman marcus for baby clothes.
August 12th, 2008 at 03:26 pm 1218554815
August 12th, 2008 at 03:30 pm 1218555033
It's not like we don't splurge every once in a while. It's a matter of priorities. As my hubby says, we want to BE things, we want to DO things, we don't want to HAVE things.
We also have a mantra: Avoid anything with a monthly payment, if possible.
August 12th, 2008 at 04:16 pm 1218557818
August 12th, 2008 at 04:48 pm 1218559724
There is a pervasive acceptance of debt. For instance, one roofing contract I spoke to,w hen I told him his roof as about $10,000 over my budget, suggested I spend my budget then put the rest on company financing-- which is a credit card with 18 percent interest. When is it a good idea to empty your savings AND go into high interest debt at the same time?
August 12th, 2008 at 04:53 pm 1218560000
A couple of years ago she was bemoaning the fact that she wouldn't be able to afford things once child support stopped. Hello!!!! That's why you plan for things and not wait until the girl is moving out. She drives a SUV, has a gym membership, gets her nails done, shops, yadda yadda. I tried to tell her to "find ways to reduce your expenses". She apparently is not willing to make sacrifices. So instead she is going to rent out my niece's room and then complain what a hassle it is to have a roomate. Some people just don't get it.
August 12th, 2008 at 06:56 pm 1218567380
August 12th, 2008 at 08:35 pm 1218573335