If You Cannot Save Enough Money for the Life You Want to Live Isn’t it Time to Redraw the Plans?

In case you haven’t noticed I’m the kind of girl who likes to save money. I met an extremely intelligent guy with a similar tendency. We are the type of people who envision large goals for ourselves and then dig our heels in the sand in order to achieve them.

Our lives are not difficult. I’ve had my fair share of strange medical problems, but in the big scheme of life my illnesses pale in comparison to the struggles of many others. We’ve both held high paying jobs and although we worked hard to increase our salaries and prove ourselves on the job we’ve have it really easy; neither of us have ever slathered tar on rooftops in the heat of summer. We dedicate long hours to our employers, but it is our own drive and determination that motivates us to work hard. In fact, we have no one to blame for that balls-to-the-walls mentality other than ourselves.

Although our success stems from a myriad of factors I believe that earning high incomes and learning to manage our money has had the greatest impact.

There are many paths people take in life. You can earn less money and manage it well or you can make a lot of money and manage it poorly. Either of these situations may lead you to the same place my husband and I have landed, but it is certainly easier to reach financial independence by understanding both aspects of the equation.

What boggles my mind more than anything is those people who earn high incomes but fail to save their money.  I’ve recently heard two stories that boggled my mind. The first was a man earning over $200,000 a year who did not have enough money in the bank to survive a three week furlough. The second was a married couple earning $200,000 a year who did not have $5000 set aside as a down payment for a new car.

As someone obsessed with personal finance I immediately want to know more. How much do they pay on their rent/mortgage, how large are their car payments, are they paying back school loans or medical bills? Where does ALL of that money go?

When I was growing up my father made a middle class salary and my mom stayed home to be with my brother and I until we were nine and twelve. During this time they drove old cars, lived in a small three bedroom house and didn’t complain about needing anything bigger. Despite earning high incomes my husband and I tend to live by a similar model.

In life you make many decisions and although we don’t think about it on a minute-by-minute basis we make decisions about money every single day.

Some decisions are rather small; doughnut here, a sandwich there. Others are slightly bigger; a new TV, a new video camera. Ultimately you make the whopper of all financial decisions, which typically consist of those big ticket items like cars, expensive vacations and a house.

Each time you spend money you lose the opportunity to spend it somewhere else. Although you can earn more money, you will never regain the dollar you just spent.  If you want to spend your money on thousands of little things then you cannot lump it together to buy something larger.

The $200,000 couple cannot afford an SUV because they are choosing to spend their income in other ways. In and of itself that decision is perfectly fine. They can choose to spend their money any way they want, but they cannot cry woah-is-me because they want a larger vehicle they cannot afford.

The same goes for any other big ticket item including a house. Don’t spend your days looking for five bedroom houses in the nicest neighborhoods with the highest rated schools. If you want to move into a larger home than create a new house fund and put every dollar you can spare towards that new goal. If you cannot save a lot of money, then stay where you currently live, buy a smaller home or buy a larger house further away from the city where housing is cheaper.

I believe your wallet should keep pace with your lifestyle. If you cannot save enough money for the life you want to live isn’t it time to redraw the plans?