Go broke in just 10 easy steps
It's hard to resist a list. Especially a short list.
Let an expert promise three or four guaranteed methods to bring about world peace, or win somebody's heart, or achieve the waistline you've always dreamed of, and most of us will sit up. At least give it a listen.
Especially tempting is a list of how to get rich. (How to get good-looking is the only list that might compare in irresistibility.)
Happily, some people who make it big seem glad to share their secrets. There are millionaires out there who reach the top of the mountain, and it dawns on them: “I'm no superman. Anybody can get up here.” And then they tell you how.
Millionaire Mike Finley, a onetime career military man, is not on a mission to proliferate millionaires but something admirably humbler: just to help people avoid going broke.
He names 10 of the most common money traps, and it's hard to fault his list — though you might quibble about which ought to come first, second and so forth.
• No. 1, he says, give top priority to the appearance of wealth. Buy a lot of stuff and flaunt it. This used to be called keeping up with the Joneses. But who are you kidding? Gaudy purchases return no profit. They also clutter up a home.
• Work a job you can't stand and try to be happy in your free time. Wrong, says Finley, who teaches money management at a college in Iowa. Much better to find a fulfilling job, train to do it well and lessen the desperation to carouse on weekends.
• Live paycheck to paycheck. Forget about saving anything. Almost as hopeless, resolve to save something after you've spent the week's or month's take-home pay away. (Admittedly, Federal Reserve policy is the spendthrift's ally here, keeping savings interest rates on savings near zero far, far too long.)
• Get a diploma and quit learning. Never again read a book on any useful subject, such as personal finance, like Finley's own “Financial Happine$$.”
• Play the lottery. A particular trap, this, for the poor and gullible. The same weekly $1, or $5, or $20 blown on a chance-in-a-million would compound to a tidy retirement nest egg if salted away.
• Max out your credit cards and make minimum monthly payments. This raises your cost for everything you buy via inexorable interest.
• When you come into a windfall of “free money” — a tax refund, say, or a bequest under someone's will — spend it.
• Treat yourself to the biggest wedding ever. What's a healthy rainy day fund, or a down payment on a house, against throwing a great party?
• Make celebrities your role models. You'll buy the most overpriced clothes, maybe even have a baby out of wedlock — and hear no applause at all in your continuing poverty.
• Think about your victimhood at every opportunity. Blame other people or “the system” for not having enough to make ends meet. But not having enough, when honestly faced, Finley says, is a powerful “motivation for a better life.”
All in all, a pretty good list.
Jack Markowitz is a Thursday columnist for Trib Total Media. Email email@example.com.