Why You’re Not Rich—Yet
If there is one universal thing that everyone would benefit from having more of, we’d have to say it is money. No one really complains about being too rich, but plenty of people complain about not being rich enough. A recent Time article discusses just that and lists 10 reasons the average person is not rich yet. Financial adviser Jocelyn Black Hodes defines being rich "as having the financial freedom to achieve your goals and live the life you want." Hodes believes that most people aren’t rich for the same common reasons. Here are the first four:
- You spend money like you’re already rich. Living beyond your means and buying expensive things that you want but don’t necessarily need doesn’t allow you to build wealth. A monthly trip to Target for toothpaste that ends up costing $300 won’t help you save money.
- You don’t have a plan. If you don’t have a financial plan, becoming rich just lingers like a fantasy that you’ll never really achieve. Write down some goals (like buying a house or taking that month off to travel Spain) and keep the list handy to refer to often.
- You don’t have an emergency fund. This is a tough one, as saving six months of income for an emergency fund is a hard thing to do. Hodes is adamant, though, pointing out that if you lose your job or have to deal with an unexpected illness, it’s much worse “if you’re forced to rely on credit cards,” because “you’ll end up sinking deeper into debt instead of, yes, saving to become rich.”
- You started late. Every day that goes by where you don’t save, your chances of becoming rich decrease. Saving is like exercising; it’s something that you know you should do, but you don’t always jump on the treadmill.
Just do it! Head over to Time for the complete list to learn more about why you aren’t rich yet.
Stylishly keep your financial papers organized in Kate Spade New York’s gold dot file folders.
What’s your technique to saving money?