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Habits of Thrift

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I have a lot of people ask me what everyone else is doing to save money?

One way to get the wrong answer every time is to ask the wrong question.


If the vast majority of America is struggling financially, why would you want to know how they do it? They sure aren’t doing it!

So don’t look around at everyone else you know to solve the riddle of “how can I save money?”

Here’s the short answer: by saving money.

And here’s the longer answer: by rediscovering the habit of thrift, a virtue seemingly long-forgotten in our “buy now, pay later” consumer economy. Thrift is simply the habit of spending less than you make.

I might add, the courageous habit of spending less than you make.

What I see “everyone else” doing is allowing their income to determine their level of spending, then trying to back off enough to save just a little.

But, honestly, if you made $10,000 more per year, do you have any doubt that if you keep doing what you’re doing now, your spending would soon increase by that same $10,000?

We are much more ruled by marketing, advertising and perceived expectations than we would ever want to admit. We are told that we should want something, or that we need something to make us happy. So we buy it.

But think about something you bought five years ago. Anything. Clothes, cars, food, phones, vacations. Anything.

Now let me ask you, do you still have it? Sometimes I get a “yes” answer to that question. But usually I get a “no!” with a you-must-be-kidding laugh.

Second, how much happiness is that item you bought five years ago bringing you today? Really? Not much? What does that tell you?

Every year that you fail to save for your future is a year squandered, never to be recovered. It’s not much different than if someone were embezzling from your retirement account. The only thing is the embezzler is you.

Is it helpful to go over your budget item by item, line by line? Sure.

But I’ve never seen a person go from being an out-of-control spender to a mature and balanced saver clipping coupons and buying generic paper towels.

There must be a fundamental (and again I would add courageous) decision to save money first, then spend only that which is left over.

Businessman and philanthropist Roger Babson once quipped, “More people should learn to tell their dollars where to go instead of asking them where they went.”

Do you want to save more money? Then save more money. After that, determine what adjustments need to be made to you spending to keep you out of debt.

Save first. It isn’t what most other people are doing.

But it’s what you need to do if you want to become that person about whom others whisper, “How does he do it?”

Byron is a Certified Financial Planner and Managing Director of the Planning Group at Argent Advisors, Inc.
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