Join Jim Stice for an in-depth discussion in this video On spending, part of 5 Personal Finance Tips.
- First, spend less than you make. It sounds simple, but in many cases it's easier said than done, but there it is. It is hard to save if there is nothing less to be saved. Spending more than you make not only digs you into a financial hole, but it leads to stress and hardship and conflict. - Your ability to save is not a function of how much you make, it's a function of how much you spend, but curtailing my spending habits is hard. Well perhaps, but do you like going to bed at night knowing that you owe? Do you like waking up in the morning knowing that you are deeper in debt than you were yesterday? Breaking poor spending habits is hard, but it is harder still to live with the increasing mountain of debt and interest that results from poor spending habits, and with that mountain of debt comes interest.
- J. Reuben Clark said this about interest, "Interest never sleeps nor sickens no dies; "it never goes to the hospital; "it works on Sundays and holidays; "it never takes a vacation. "It is never laid off work, it buys no food; "it wears no clothes. "Once in debt, interest is your companion "every minute of the day and night; "you cannot shun it or slip away from it; "you cannot dismiss it. "And whenever you get in its way or cross its course "or fail to meet its demands, it crushes you." - So, spend less than you make.
You can't get out from under the burden of debt and interest until you do. You can't start saving until you do. Spend less than you make.