Raise your hand if you’ve resolved to save money or fix your credit this year. I don’t know your experience, but most of the people I know are on one end of the spectrum or the other when it comes to saving money. Either they easily save, or money burns their pockets. I myself struggle to save money and I will tell you why… My entire childhood I watched my mother “struggle” financially. We grew up “house poor” and it seems like my siblings and I never got anything we wanted… Mom was always “broke.” How ironic it was for me to follow in my mother’s footsteps, but for a long time I did... until I woke up.
Don’t get me wrong… Momma (and everyone like her) just made it work, “Robbing Peter to pay Paul”! Now I realize this may be a foreign concept for “summa” you so let me explain… “Robbing Peter to pay Paul” is a “ghetto-ism” (I just made that up); an “urban phrase” referring to a particular type of money management. It’s where one shifts money from one bill to pay a more vital one. In our case vital meant… or else it’s getting shut off. As sad as it was, the only money management training we received was watching my Mother “stretch a dollar,” overspending or taking items out of the cart at the cashier station OR most often hearing “no” and getting hands slapped for touching things? I can hear her words echoing in my past memories… “touch another thing, hear?” smh
Let me be clear poor money management comes from (#1) not understanding money, the lack of Literacy Education/Training, NO Budgeting, Poor spending habits, and lack of discipline. LACK, LACK, LACK, the perception of LACK or the FEAR of Lack are powerful barriers to the proper handling of money.
People often, just like I did, refer to their meager upbringing to excuse their financial irresponsibility because they don’t want to reign in their out-of-control spending habits. I mean who doesn’t love to shop and get the things they want, when they were deprived as children. But at the end of the year, after pouring Trillions of dollars into the market, have precious little to show for it and can still have the feeling of “struggling” to make it. Let me tell you why that is… It’s called “The Poverty Mindset,” which is a GENERATIONAL CYCLE. Not a lot of us received Money Management strategies from our parents, uh because they weren’t taught by their parents, whose parent didn’t have the knowledge to give them, nor did their parents or their parents before them. Hello, that’s GENERATIONAL. This knowledge was withheld (or not shared) with many of our ancestors by those who believe money is POWER. I’ve heard it said “The Poor” could pull themselves up by their own bootstraps if they went to college or worked harder - but this is not always the case, especially when those people are constrained by The Poverty Mindset.
Most poor people think winning the lottery will solve all their problems. According to an article called Five myths about the Lottery written by Economics Professor George Loewenstein (Washington Post, 2019/12/27), “70% of lottery winners go bankrupt within a couple of years.” I’ll give you two guesses as to why that is (Poor Money Management and/or the Poverty Mindset). Getting a better job will give you more money but how far do you think you can get with the The Poverty Mindset constantly screaming at you “OOOOO MORE MONEY!!! Yayyy! Now you can finally buy that thing (or things) you’ve been fiending for!” It’s another gerbil wheel, that must be destroyed in order to move forward. The Poverty Mindset must be replaced with sound financial knowledge, motivation to change, combined with energy, strategy, and positive producing action. Yes, it’s gonna be tough! But my question to you is…. HOW BAD DO YOU WANT IT. No more struggling and no more excuses… WANT TO FIX YOUR LIFE? First things first… make up your mind that you need a change! Then do it! Create some goals and a budget, and start with tiny steps.
THESE FINANCIAL LITERACY RESOURCES WILL HELP
Websites
MoneyMavericks.com, MyMoney.gov, khanacademy.org, www.daveramsey.com
Podcasts
Stacking Benjamins, The Dave Ramsey Show, His and Her Money, The Fairer Cents, The Truth About Money with Ric Edelman
Also see my book 4SELF 101 (Chapter 9: Money, Money, Money).