Seven Cures for a Lean Purse Part 1
“The HOLE in our pocket/purse is usually larger than the money we are putting in – there is a cure for HEALING this HOLE – the medicine however, may hard to swallow and a bit bitter to the taste…” — Rick Cox
“But the result is worth the inconvenience of having to put up with the taste and taking the time to swallow…”
It doesn’t really matter what you do for a living, whether you are an attorney, a doctor, a plumber, a construction laborer, teacher, waiter/waitress or bus boy, everyone has the opportunity to get ahead IF THEY WILL START THE PROCESS OF SPENDING LESS THAN THEY MAKE. To a vast majority, the taste of this pill is often too bitter and the size of this pill too large to swallow therefore, they remain in the same trench with no light at the end of the tunnel…
Jim Rohn once said, “It doesn’t matter what the minimum wage is because it wasn’t designed for you to stay there. It is simply a starting place – designed as a ladder or bottom step if you will.” What Jim meant by this was you don’t purchase a ladder just to stand on the first step. You purchase it to help you reach higher levels. The first step isn’t where you stay for you are supposed to continue climbing the ladder reaching greater heights and getting to that for which you purchased the ladder. In this case, you are not to stay on the first level, but rise to higher levels of income. Likewise, it is the same with what you do and how much you make. You are not locked into what you do unless you allow yourself to be. As long as you are breathing you have the opportunity to become more and thus, make more.
Cure #1: Start FATTENING YOUR BANK ACCOUNT…
The Richest Man in BabylonAs I said, it doesn’t matter what you currently do to make a living. What does matter is if you can learn to live within your means. Can you learn to set aside and keep at least ten percent of every dollar made from here on out? I personally knew two teachers who were able to save enough money to retire from teaching moving full time into property management and development at the early age of 42. AGAIN THEY WERE ONLY TEACHERS doing this on a teacher’s salary. Yes, they had to sacrifice, they worked summer school and tutored. Neither owned a car; both rode bicycles; both worked at the same school; both skimped and both saved. What you will find is it doesn’t matter what one does for a living; IF THEY ARE LIVING BEYOND THEIR MEANS they will always be poor for they will be indebted to others regardless of how much it may appear they have amassed. If they learn to save however, their money will grow allowing them to pass those who make much more, yet spend it all.
During many years of owning businesses, I have had to ‘counsel’ numerous employees regarding the saving of money. The stories I would hear from some were incredibly well thought out or so they thought. I was still able to shoot their stories full of holes. When I did, I took away their excuses for not saving money. I would like to share one in particular with you.
I had an employee, which was always in debt to the point it affected his work. Both he and his wife had great jobs making great money, yet they were always broke. They owned their own home (with a first & second mortgage); had three children and the children went to public school. They had only one car to pay for and insure as I supplied him with a company vehicle. Because his financial issues were affecting his work, we had a meeting to discuss his situation. I guaranteed him if all three (his wife included) of us sat down at the table we would be able to put together a budget saving him at least ten percent and I would not touch the money he and his wife spent on cigarettes. He in turn guaranteed me that could not and would not be possible. I told him if I was not able to do this then I would personally give ten percent extra out of my pocket for him to put in savings.
When we sat down I handed them copies of a budget sheet, which I had used in the past. This sheet had boxes for the house payment, utilities, home owners insurance, home maintenance and upkeep, water, vehicle payments, car insurance, gas, vehicle maintenance and upkeep (oil change, tires, etc), groceries, clothing allowance for the whole family, school supplies, vacation, health insurance, date night, family night, a few other items as well as THEIR CIGARETTES. In one column we were going to list the amount of money they brought home after taxes and deductions, while in the other column we would list the cost for all of the items above.
Previous to doing this I asked them if we could take a moment to go over their current daily habits. They agreed. I chose to go over what I knew were the daily habits of this employee first. I listed on the back of one of the sheets what I knew he could cut back on and thereby, in the process save money: (remember these are 1986 to 1995 prices)
1. Morning coffee/pastry from Circle K
2. Mid-morning snack with Big Gulp from snack wagon or Circle K
3. Lunch at Jack in the Box or equal
4. Mid-afternoon Snack with Big Gulp from snack wagon or Circle K
5. Big Gulp on way home from Circle K
6. Bowling on Thursday and Saturday nights
@ $35.00 without beer for his wife.
7. Golf on Saturday or Sunday
8. Movie on Friday night
@ $15.00 to $18.00.
The total of the above adding up only the minimum amounts listed came to $90.00 per week. This is not what his wife spent per week and not what it would be IF WE ADDED THE CIGARETTES. So, just that $90.00 per week total came to $387.00 per month @ 4.3 weeks per month. Since she was only involved in a few of these activities listed above, her total would be less, but not significantly less. If we added just another $250.00 for her, we would then be @ $637.00 per month and this is not considering she drank alcohol and he did not. Bottom line is they had plenty of money to spare, but they couldn’t see it. All they had to do was to make and bring to work with them their own snacks & lunches as well as their own drinks or simply drink water. What I can tell you was, as I started down this path their faces got red, but not from embarrassment as it should have been. Their faces were red with anger. They were angry that I was taking away from them ‘their right’ to enjoy life.
This was not my intention at all. I was simply trying to get them to live and enjoy life and not be harassed by creditors and bill collectors, which were coming to the office as well as trying to garnish his wages. I also felt it would be good for them to eventually be able to do things with THEIR OWN MONEY AND NOT SOMEONE ELSES. They didn’t have to bowl or belong to a bowling league. They didn’t have to play golf. They didn’t have to go to the movies. They didn’t have to eat out for dinner each week. It might be good to note I had not, as yet, added the fact they were eating out almost every night.
There was so much more I could have done, but it didn’t go any farther for they got up and left. They had a big hole in their purse. The hole their money was going out of was much larger than the money they had going in. They were enjoying life on money that wasn’t theirs to spend. THEY WERE THE HOLE! Does this sound familiar? It doesn’t have to be this way if you will start to discipline yourself just a little each and every day. If you will start down this path, soon it will grow. You will like the feeling you create as your purse begins to fatten.
One other thing to remember is, don’t look at what others appear to have for in most cases they don’t own it.
You can save ten percent and you will not miss it. Make it a habit.
Best of LUCK as you
Labor Under Correct Knowledge…