I am making more money than I ever thought possible. As a kid I used to look at people making the amount I do and dream of the day I would be living in the lap of luxury like that. Now I am there and it looks nothing like my dreams. Look, I am not dumb... I am a college graduate. I understand the effect of inflation on the cost of living. It just never occurred to me that I would need to make double the salary of my father to keep the same standard of living.
So I need to make double the salary of my father, or do I?
You see, It never was really my intention to have the same standard of living as my father. He never had more than one T.V., and as for computers... Well he got his first and only one when I was already an adult. Me? I have three and I am thinking of replacing at least one of them this year. That doesn't take into consideration the four gaming console systems I have purchased including a second XBox 360(Thank you red ring of death).
I figured all this was necessary for a basic standard of living for my family. I required all the gaming systems, computers, iPhones, gadgetry, etc... I mean isn't that what we all need? Of course I couldn't afford to buy them with cash, so I mortgaged future earnings to the credit card gods for the basic necessities of today.
Like I said, I am not dumb. Or am I?
I think the first sign of my ignorance was the expectation that my standard of living when I started out would be the same as my father's at the time. Looking back on it, that's sorta stupid. I should have expected to live like he lived when he started out. He didn't even have a T.V., but boy I had to have one. The same with a computer, and a cell phone. They were absolutely essential.
When my job barely paid for rent and food, how did I get these other essential items? Just put them on the credit card. That way I could live the lifestyle of my father without having to wait until I could pay for it.
As the years went by my standard of living naturally increased with my income. But I had already spent that increased income. Do you see the problem I had? The problem we have? The problem this country has?
To support an increased standard of living that you cannot afford you end up floating checks between pay periods, getting pay-day loans, maxing out credit cards, and pulling equity out of your home. All of these things to maintain an unsustainable lifestyle. What's worse is this debt culture is being passed on to the next generation.
No... I don't think I am dumb, just ignorant.
- Ignorant because I wasn't willing to wait to live a lifestyle I could pay for.
- Ignorant because I continued to increase my standard of living on the back of credit
- Ignorant because at any point I could have stopped the spending cycle.
The good news is that the debt culture can be overcome, but to do it we need to use our smarts and overcome our ignorance.
