Comments on: What is the Definition of Living Beyond Your Means?

By: Slinky

Slinky — Tue, 06 Jan 2009 23:34:00 +0000

Net worth is a good depiction of living above or below your means. If it trends downwards, you are spending more than you are bringing in. If it trends upwards, you are spending less than your income. An even trend indicates living right at your means or paycheck to paycheck.

My net worth shows that I was living beyond me means during college, but now am spending under my means. The large drop is simply because I didn't record my car's value as an asset.

By: Amanda

Amanda — Mon, 05 Jan 2009 18:54:00 +0000

I get living above your means is not being able to pay your bills or paying your credit card bills in full. But why use a credit card in the first place?

I think my definition would be that you don't use debt for anything and pay everything in cash/debit. Living within your means is not spending more than you make.

By: Kristen@thefrugalgirl

Kristen@thefrugalgirl — Fri, 02 Jan 2009 12:47:00 +0000

Yup, we live within our means. It's a lovely feeling.

However, we are definitely above the 40% for our housing. We live in a high cost-of-living area, and it's pretty much impossible to keep it at 28%.

By: Anonymous

Anonymous — Wed, 31 Dec 2008 08:45:00 +0000

I do live beyond my means, but not to an extreme 🙂

By: Mrs Money

Mrs Money — Tue, 30 Dec 2008 15:43:00 +0000

I really like this post! I found your blog via BlogHer and I am glad I did. 🙂

By: Elizabeth

Elizabeth — Tue, 30 Dec 2008 07:02:00 +0000

I hope you had a wonderful Christmas!

I had a few years where I did not, but I do now - and did prior to that episode. Well, I guess I'm not entirely sure what my credit score is but am pretty sure that it's quite good. :)

That chicken curry recipe looks really good. I may try it. I had a friend give me a mushroom curry recipe once but she cooked by instinct so gave me directions like "cut up some mushrooms .. toss in curry .. maybe a pinch of salt .. " I need something more exact to follow. :)

By: retire-at-40

retire-at-40 — Mon, 29 Dec 2008 09:35:00 +0000

Whilst the percentages in the definitions can change, there are some basics to the whole thing. In fact, my favourite phrase is:

"Spend less than you earn."

I've been doing that a while and now my new phrase is:

"Spend less, save more."

I'm soon gonna change it to:

"Spend less, save more, earn more."

By: slackerjo

slackerjo — Sun, 28 Dec 2008 23:12:00 +0000

Rent where I live is so high that at best you are going to spend 40% of your income on rent. And that might not even be in a nice apartment in a nice part of town.

I believe the 28% thing is a bit out of date.

By: Fabulously Broke

Fabulously Broke — Sun, 28 Dec 2008 15:30:00 +0000

I do...now.

Great post. I like the examples from investopedia because at least people can measure themselves up against it.

Am going to link to this.

Fabulously Broke in the City
Just a girl trying to find a balance between being a Shopaholic and a Saver...