MONEY OBEDIENCE

Save Money at Any Income Level

One of the all-time favorite topics of personal finance bloggers relates to the world of the rich. So many of them are writing about this topic. How do you become rich? How do the rich save money? What kind of things can you do, when you are rich? What is it like to be rich? How much happier are the rich than the poor?

Being rich is indeed a very interesting topic, but let’s face it. For most everybody it is a dream that will not become real. It has to be that way, because being rich has to set you apart from the large majority of people – isn’t that a clear part of the definition of the word? These facts leave us with one important choice. We can choose either to (1) chase becoming rich or (2) work with what we have and enjoy a good life with our limited financial means. I am a big advocate of choice (2) since this choice benefits about 98% of people, if not more. As far as I am concerned, to be totally unconcerned with choice (2) you’ve got to be very, very rich so that money is no longer a limit to what your imagination can cook up.

To me, security is necessary for happiness, but being rich does not make you more financially secure. I am sure you would agree that somebody who lives in a house worth more than one million is rich, at least rich enough that a bank thought that he or she could pay back a seven-digit loan. But let’s look at mortgage default. The New York Times reported a few weeks ago that the “Biggest Defaulters on Mortgages Are the Rich.” More than one in seven homeowners with mortgages in excess of one million is delinquent. In contrast, only one in twelve homeowners with a mortgage of less than one million is delinquent. How did money buy them happiness?

There may be many reasons why the rich are walking away from their mortgages, but one thing is for sure. A lot of people who are considered rich are not so rich that money is no issue. I certainly do not want to be one of those rich people who decide to default on their mortgage. Being this type of rich is not my dream. I rather dream of having my finances in good order, enjoying a good life with my limited financial means, and feeling good about myself. It is challenging enough for me to reach these goals; I don’t need to chase some elusive goal of “being rich” – whatever that means!

How are you doing with your life goals?

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Posted in personal finance