The last few days I’ve been riding around in a nice Lexus SUV…
No, it’s not mine. I’m borrowing it while my fiancee took our car for a few days.
And it’s weird…even though I could now easily afford a Lexus, heck, any Lexus really, I just feel funny driving it. Maybe the feeling will change after a few days, but I don’t think so.
You see, I still “think poor”. Even though I’ve got a healthy emergency fund, and my car is paid off, and my income is great…I still “think poor” a lot. When I’m at the grocery store, I still get a little anxious buying the nicer fruit or an extra treat.
And it’s not a bad thing at all. In fact, I think a lot of wealthier people “think poor”. I think alot of wealthy people weren’t always wealthy and once they “made it” they don’t turn into Lexus-buying Gucci-wearing consumers.
Anyway, I haven’t “made it” buy any means. But I’m very happy. I sleep well at night now. I have a wonderful partner (and future wife!), and I have lots of fun opportunities in life to pursue.
One thing I’ve found that helps me not get carried away when I have money in the bank is to never keep more than 2-3K in my checking account. Any amount over that gets put into my online savings account at ING or SmartyPig. That little technique keeps me in check.
Also, I have a fun post coming up about a pretty large investment that I made about 6 weeks ago. It’s taken some time to get setup, and so far it’s going well, but I’m at a point with my savings now that I need to start putting some money to work outside a savings account.
So, what do you think? Do you “Think Poor”?
{ 6 comments… read them below or add one }
Debtkid – You got it!! “Wealth” is as much a state of mind as it is the amounts in your accounts. I am convinced this is a portion (certainly not all) of the reason that some well to do get wealthier, and others, with the same resources starting out, end up living paycheck to paycheck. There are many “theories” about this, but it all comes down to one thing – don’t spend just because you have the funds. One way to look at this is delayed gratification. Another is the theory espoused in the book “The Millionaire Next Door” – I think he concluded that many of the millionaires in this country are driving older model Ford vehicles. Just because you have it, you don’t spend it. That way you will still have it, and that gives tremendous peace of mind.
…and, DK, one BIG clarification. What you are doing is “thinking sustainably.” You were doing that when your bank account was low, and you are continuing to do it. If you were “thinking poor” your bank account would still be low – you would have seen no light at the end of the tunnel, had no self discipline, and spent whatever you wanted because you would not have understood the difference between wants and needs. You learned; you understood; you believed in yourself. The way to keep the current state of contentment, to sustain that calm and peacefulness about your finances, etc is to continue to “think sustainably.” Please don’t start “thinking poor.”
I know that there was a post awhile back about car/status/perception and there is definitely a perception to the vehicle as well as a status symbol wrapped up in that. That all being said, I love my BMW x3 and I love bragging about buying it was a CPO rather than new. Got it for about half of what a new one would cost (22k vs 40k +) and it has a better warranty (factory of 4yr/60k vs 6yr/100k). Heck, my brother paid more for his Saturn.
My wife has certainly noted the receptions she gets when she delivers baked goods (side job of baking cakes and cupcakes while being a stay-at-home mom) in the x3, so it works in our favor.
Thinking poor is not a bad thing at all. I rather be wealthy and think poor, than to be poor and think that i’m rich. Sometimes that is the recipe for brewing more debt. Anywho, great article!
DK,
Congrats man on the major investment, I look forward to reading more about it! My fiance and I are in pretty much the same boat as you guys, when are you getting married? We are setup for 10/10/10
RE the vehicle situation I have to confess, I just replaced my rusted 2000 Jeep Cherokee sport with a certified pre-owned BMW (bought with .9% financing, used the cash I would have put to pay off the car towards our mortgage of 5%). The gas gauge was broken, etc. and eventually I cracked and upgraded. We looked at many Lexus models but nothing felt right. You can still be conservative and upgrade to a nicer ride!
Overall I’d say we definitely Think Poor in some instances but also have a logical side. If you are driving around a rust bucket and making a good living, might be time to upgrade!
I like the idea of only keeping 2-3k in your checking account and the rest in your savings. This way, the money is not immediately available and seeing a smaller balance in your checking account will help you to “think poor”. I like to buy products that are not brand name as much as possible in order to save money at the grocery store. That’s one what I “think poor”.