Make Money More, Spend Money Less
We’ve all heard the cliché, “You must spend money to make money.” Well, experts have proven that that is not always true. Now we have the cliché, “The more you make, the more you’ll spend.” Unfortunately, this one is usually true.
What is it about money? Sure, it gets us the things we need and even more of the things we want, but what about a rainy day? In a society where the economic picture is bright one day and dim the next, you would think that we would save more money, but that is not always the case.
It is the “feast or famine” mentality. When things are good, we don’t think that they will ever be bad. A good case in point is tax refunds. After working hard all year, we file our taxes and a month later we are rewarded with a tax refund. The question now is what to do with that refund.
Here’s the dilemma. On the one hand, we know we should put it away in an account and use it for a rainy day. On the other hand, we have scraped by all year and now we get to the point where we can afford some of those things that we wanted all year but couldn’t spare the cash to get. The tax refund is the perfect way to buy those things.
What we fail to realize is that when we spend that money, we are back in the same situation again. It is like a vicious circle. Seeing the “now” means that the future is sacrificed. If we want to break the cycle we must continue to hold off on those things that we feel entitled to and save that money.
But, the money that we save can also make us money. Leaving it in a regular checking account means that by next year we may have a few cents more. Investing the money in a certificate of deposit, a mutual fund, stocks, bonds, or some other vehicle, will see a greater return on our investment in the long run. If we learned how to make it all year without that extra money, we can continue to do it and let the money make us more money.
Spending is a bad habit that people have. It’s not all our fault, though. Advertisers are getting better at their jobs and making us believe we can’t live satisfied lives without their products. I feel better, don’t you? Now we must face the fact that the ultimate decision about what we do with our money falls on us. If we let a television ad lead us astray, we will be the ones to pay the price.
When we make more, we spend more. But it is not necessary to always do that. Make that hard-earned money work by investing any surplus to increase our savings.
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