10 Reasons You're still broke

[Planogirl]

We might do better if we kept up with the Joneses a little better. We all drive old cars on purpose and lately those things have been breaking down a bit too often. We might need to rethink that.

 

[bbak3030]

I refuse to spend $60,000 on a car, it's just a car! DH and I have been married for 11 years and we have never had more than 1 car note at a time. My car is 10 years old and works just fine. I have a 2004 Toyota Highlander that has never given me a problem and has 160k miles on it. When I graduated nursing school in 2012 my sister asked when I would get a new car. I was like, why? My car is fine.

Vacations. That is where we spend our money. 3 planned in the next 7 months. Trip to the beach, Thanksgiving in Gatlinburg and then Disney in January. That's worth driving the 10 year old car to me

 

[ellochka]

I refuse to spend $60,000 on a car, it's just a car! DH and I have been married for 11 years and we have never had more than 1 car note at a time. My car is 10 years old and works just fine. I have a 2004 Toyota Highlander that has never given me a problem and has 160k miles on it. When I graduated nursing school in 2012 my sister asked when I would get a new car. I was like, why? My car is fine.

Vacations. That is where we spend our money. 3 planned in the next 7 months. Trip to the beach, Thanksgiving in Gatlinburg and then Disney in January. That's worth driving the 10 year old car to me

Friends of ours took a year to travel around the world (she lost her job in a buy-out, and was paid handsomely). Their relatives were shocked because everyone had thought they were poor because they drove old cars. Well, they were not poor at all... because they drove old cars.

 

[kymom99]

I agree, one car loan at a time, and we don't run out and buy a new one just because we pay one off. The only reason I have a loan now is because my last car died shortly after it was paid off (I bought it used). We have 3 vehicles for 2 drivers but one is an old pickup for the farm.

Our next door neighbor has 4 cars for 2 people. One is an Escalade, one is a Mercedes SUV, one is a 2-seater Audi, and one is a new Toyota van. They have 4 kids. I have no desire to try to keep up with them. They have every yard toy imaginable as well as a pool with a waterfall. They have no grass left to play in so they play in our yard.

The reasons I am still broke is because my son goes to private school, I have a house that I am renting to my niece. She is supposed to buy it when her husband finally finds a full time job (I am losing money on it), and I insist on taking a vacation every summer even though the money could go towards bills. This year was a short trip and next year will be too.

We are paying all our bills but I would like to pay some debt off faster.

 

[Iowajes]

We might do better if we kept up with the Joneses a little better. We all drive old cars on purpose and lately those things have been breaking down a bit too often. We might need to rethink that.

My car is 14 years old, and mostly still doing great (did replace a very expensive timing belt around the 10 year mark). But I have a "if it costs more than $600 to repair, get a new car" mantra now. It's old enough that I can't put TOO much more money into it.

 

[barkley]

#1 You quit school
No, I finished so I am paying back student loans which adds to the pile!
I did follow their 'guideline' without thinking much about it though.
we finished as well. I'm old enough to have attended when the system in California was affordable enough to pay as you go, w/dh we paid it off best as we could while he went and then paid the balance of as soon as we could.
#2 "You try to keep up with the Jones'
Not really... I drive a '97 beater and we didn't buy the largest house we could afford in the hip neighborhood. I only spend money on things I actively want - no boats, RVs, etc.
same here. we've always bought homes well below what we were told by lenders we could "afford", and only purchase other items based on our wants.
#3 You're hardly working
This is absolutely me.. but not my husband. There isn't anywhere for me to grow to is the problem.
well, I guess as an early retiree I could be guilty of this
#4 You have bad habits
Coffee daily, check. $2.30 a day is still something... I'd argue that taking up running, futsal etc has in itself been a drain on my pocketbook though. Athletic clothes and equipment are not cheap!
isn't it a requirement as a resident of Washington that we financially support our coffee industry???? other than that, yes we have bad habits-but the state via it's sin taxes have helped curtail them.
#5 You make impulse purchases
Occasionally if we are out of cookies and I want one I will add it off the list its true...
same here-especialy if the sample at trader joes is too good to resist buying some of
#6 You play the lottery
No, we very very rarely get a Powerball. Maybe 2x a year my husband get a $2 ticket if there is an office pool.
innocent-haven't played in years.
#7 You make minimum payments
On all but the highest APR. We put as much as we can to that and are snowballing.
the snowball works. we're now at the point we can pay in full each month.
#8 You lack goals
I have many, many goals. All of them to someday be able to afford some things/retire well, lol!
we have goals too-but like you we have to achieve our short term in order to meet our long term
#9 You hang out with the wrong crowd
We all TRY to be responsible... but I suppose I'm the one who encourages others to have a budget and check their 401Ks periodically so maybe this is spot on.
we hang with some but that doesn't mean we mimic their habits. just b/c friends like to eat out regularly or have regular appointments at the nail/hair salon, or partake in what we consider costly activities doesn't mean we have to (and I don't know if they can afford it or not-none of my business).
#10 You're a couch potato
OK, I do watch an hour of TV on average while we are eating our dinner. But we do SOMETHING every night so I dunno if I would call myself a potato. Walks, go for a jog, lift weights, garden, etc otherwise I feel yucky especially in summer! I volunteer too. So neener.
major tato head here-but I don't have the luxury of being able to seek employment, so it's cheap entertainment vs. many other what I perceive as costly activities outside my home.



I know why I'm "broke" - because I spend my money!

if you're spending your money on snowballing your debt-it's money well spent



I don't know what the secret is to all this stuff-I think to some extent it just comes down to making the right decisions depending on your own individual financial situation. I know people who watch every grocery ad and have multiple stores they run to in order to get the best deals, but then they turn around and make huge impulse/keeping up with the jones' buys only to complain how short they are on their day to day budgets. the flip side are those that think any purchases of $20 or $30 is 'no big deal' so they do it constantly and then when they need/want to do a big purchase/expense they complain that they can't afford it.

for us it's a balancing act-a 'deal' is only good penny wise if it doesn't cost us more gas than we already plan on using. a big item's cost may be justified depending on it's purpose (neighbors though I was nuts buying a steam cleaner for the carpet until I pointed out that it only cost about what 3 times renting cost them-so it's paid for itself. we need to do power washing-kills me to pay for 2 days rental vs. buying BUT it's less than 1/3 the cost and in over 10 years we've never needed a power washer before).

I will be truly fascinated to see how our expenses change come fall when one of the kiddos moves out on their own (truly interested to see the impact on food and utilities)

 

[SandyinMonterey]

Growing up, we had neighbors that seemed to have everything. Always the latest toys (boats, jet skis, new cars, etc.). They also were always doing some kind of home improvement project to the outside or inside of the house and taking multiple vacations. Every time I would see the Mrs. come home, she was emptying the trunk of her car with endless of shopping bags from department stores. Fast forward thirty plus years, the Mr. of the home was involved in all sorts of illegal activity and is now facing major prison time.

 

[bbak3030]

Yep, to each their own! We like to spend our money on experiences, hence the vacations over car notes. Our girls also do a lot of activities, which add up. Our oldest made AllStars this year. The equates to a hefty entry few and travel out of town for the state tournament. We also do dancing and gymnastics. Oh and we like to eat out and we have a housekeeper. Lol. To each their own.....

 

[StephMK]

Good article! I do think it's hard when you hear about big trips and see people who seem to have money for everything. I know there are many who truly have the means to do it and I just remind myself we are not those people.

But then some of those people I see IRL who always get their hair & nails done and seem to eat out all the time complain about debts. So it really makes no sense to "keep up with the Jones" because you most likely don't know the whole story. Great salaries, inheritance, big debts, who knows so I really just can't worry about it. I take care of our budget and that takes enough attention and dictates what we do.

My big weaknesses are impulse "sales" buys and the darn kids. It is hard to resist those "great buys" but I do try to limit them now. Those kids and our money pit house make sure we usually have to spend any "extra" cash we might accumulate.

After a long time, we are heading into a good financial place and are determined to keep that going. Thankfully we don't have expensive tastes or hobbies. I would say we are very run of the mill, middle road spenders. Not overly frugal but not fancy spenders either.

 

[MomToOne]

"drive your clunker until it drops"

That was my plan. I hoped to drive my beloved, paid off, mechanically solid 6-1/2 year old car for the next 4 years or so, then give it to DD as she went into college.

But sometimes the universe has other ideas.

Last week I was rear-ended - hard. I was stopped at a light, the driver behind me must not have noticed the string of 8 cars waiting there, and ran into the back of me still going fast enough for her airbags to deploy. My car was officially pronounced totaled this morning - it had over 11K in damages, and that was just the first look - there was likely more damage that they wouldn't find until they fully tore down the car. The adjuster was amazed no one was hurt in any way.

So it was off to buy a new car this afternoon. Newer version of the exact same car LOL Got a good deal, since it was end of quarter, the new model year is out, and I get a vendor discount with the manufacturer. Plus the settlement on my old car is going to be about 3K higher than I thought I was going to get - that car held it's resale value pretty darn well. But that still left me paying out of pocket for about half the car. It wasn't in the financial plan for the year, but hey - that's why you save, to cover life events like this! And for the first time in my life, I could pay cash for a car without much stress (other than seeing that amount disappear from my account!), and didn't need to finance it.

RIP Ol' Reliable. You weren't anything fancy, but we will miss you dearly.

 

[Nayan]

My car is 14 years old, and mostly still doing great (did replace a very expensive timing belt around the 10 year mark). But I have a "if it costs more than $600 to repair, get a new car" mantra now. It's old enough that I can't put TOO much more money into it.

That's my mantra too! I just bought a 2008 Altima to replace my 96 Mustang that needed a new transmission (over $3k). I tend to keep my cars for as long as possible but if it costs more to fix than the car is actually worth it's time to look for another one.

 

[Iowajes]

I got a piece of mail yesterday that made me laugh and thought others might enjoy it, since we are talking old cars.

The local Honda dealer sent me a "comparable offer" for me to "upgrade" my car.
They somehow determined I had a monthly payment of $400-600, and for that same amount I could get one of two different 2014 Civics, to replace my 2001 Civic.

My husband and I were cracking up trying to figure out what the heck kind of loan they thought I got (actually I didn't- we paid cash), because the dealership knows I bought the car new.

So somehow they determined I had a 13 year loan, with an interest rate so high I was paying $600 a month?

 

[leebee]

We eat out too much. It's usually nothing fancy, just the pub down the street and almost always on a "deal" night ($6 burger night, 50cent chicken wing night, 2-for-1 pizza night) but for two of us, with tax and tip (and a beer), it's always around $25. That's $200 a month. We also enjoy going to the taproom once a week, and that's always about $15. It adds up.

We are also paying DD's college tuition. We can't pay all of it, but I bet we pay close to $10000 a year. Only one year left, and we can do it… I hope… She will end up with about $25K in loans, but it's OK, and we hope to help with those payments.

Before college tuition, it was dance tuition, pointe shoes, dance shoes, costumes. Leotards and tights. She is still dancing, but does so at school for no additional cost, so we save the $2000 a year dance tuition (which goes to college tuition). Still paying for pointe shoes, but she wears a shoe that isn't made of muslin and glue, that lasts longer than regular pointe shoes. Still, it's probably $400 a year (as opposed to $1000 or more for paste shoes).

We pay our bills in full every month. I know it sounds like I am gloating/bragging, but I am just good at remembering what we've spent and how much more we can absorb before the end of the credit card cycle. We don't put more on the credit card than we can pay off every month. It's nice to not have any debt, but it means we don't have much free-flow cash, and we don't have toys… no cell phones, iPads, big screen TV, no designer label clothes, minimal pairs of shoes, our cars are 8 and 10 years old (only debt we have is the loan on the van, with only $2200 left to go!).

We have a savings account, and retirement accounts. Nothing extravagant, and not enough in retirement, but some. The savings account is for house emergencies, like the $7000 roof repair we are currently facing. It'll drop the account down below what I refer to as my "sleeping point" so we are thinking of a fixed rate HELOC for the roof, and we could get the windows done, too. That's gonna be close to $3000; the two together would kill the savings.

SO.. I know that we are basically "broke" because we are mostly responsible with our money. It hurts to see friends spend willy-nilly on fun stuff, but we are on a budget to make ends meet and save some money, so I can sleep at night instead of worry about how to pay for things. I don't mean to say that we struggle or buy everything on sale or at goodwill, but we are cautious about expenditures, and avoid the daily-habit drain of coffee or lunch out- little things add up.

(And yes, we go to Disney, but usually it's under $1500 for two of us or $2K if all three of us travel. This fall's trip is a splurge.)

 

[BSmithington]

Long-time lurker, first time poster...

To our family its all about balance. Both my wife and I lost our parents very early and shockingly no one mentioned how great at keeping a budget they were or how they admired them for keeping cars 10+ years at their funerals. What struck me was the number of people that kinda chuckled and told me a story about a night out with my Dad or a fishing trip they took.

When I die I want to ensure that I lived my life to the fullest - That I got to see everything I possibly could. I want my kids to be taken care of, but I also don’t want to be eating ramen so I can pad their inheritance. We have a very healthy retirement account but honestly I don’t live for tomorrow. I could be hit by a bus on the way to lunch.

 

[DawnM]

Wow, we do NONE of the above.

I feel like a couch potato right now, but it is by choice (SAHM) and not because I don't want to work or don't have the desire.

We are also not broke.

 

[barkley]

We eat out too much. It's usually nothing fancy, just the pub down the street and almost always on a "deal" night ($6 burger night, 50cent chicken wing night, 2-for-1 pizza night) but for two of us, with tax and tip (and a beer), it's always around $25. That's $200 a month. We also enjoy going to the taproom once a week, and that's always about $15. It adds up.

We are also paying DD's college tuition. We can't pay all of it, but I bet we pay close to $10000 a year. Only one year left, and we can do it… I hope… She will end up with about $25K in loans, but it's OK, and we hope to help with those payments.

Before college tuition, it was dance tuition, pointe shoes, dance shoes, costumes. Leotards and tights. She is still dancing, but does so at school for no additional cost, so we save the $2000 a year dance tuition (which goes to college tuition). Still paying for pointe shoes, but she wears a shoe that isn't made of muslin and glue, that lasts longer than regular pointe shoes. Still, it's probably $400 a year (as opposed to $1000 or more for paste shoes).

We pay our bills in full every month. I know it sounds like I am gloating/bragging, but I am just very good at it. We don't put more on the credit card than we can pay off every month. It's nice to not have any debt, but it means we don't have much free-flow cash, and we don't have toys… no cell phones, iPads, big screen TV, no designer label clothes, minimal pairs of shoes, our cars are 8 and 10 years old (only debt we have is the loan on the van, with only $2200 left to go!).

no designer duds for us either, fact is we spend very little on clothing for a family of 4 vs. most I know. BUT-our clothes are migratory in that when someone tires of something it's up for grabs, so as I'm forcing everyone to clean out their closets and bureaus this week the majority may end up another family members (especially graphic t's). when people complain their jeans are getting too tight (usually in the comfort food winter months), if the jeans are in decent condition they get stored away until I hear complaints a few months later that their jeans are getting too loose. for everyday shoes we are Vans junkies, so since we finally have reached the point where no one outgrows shoes if we will be vacationing near a Vans outlet store every few years we stock up at a fraction of the cost

We have a savings account, and retirement accounts. Nothing extravagant, and not enough in retirement, but some. The savings account is for house emergencies, like the $7000 roof repair we are currently facing. It'll drop the account down below what I refer to as my "sleeping point" so we are thinking of a fixed rate HELOC for the roof, and we could get the windows done, too. That's gonna be close to $3000; the two together would kill the savings.

when you're looking at the cost of replacing your windows don't forget to figure in any energy efficient tax credits and/or rebate programs from your utility company. our utility company offers a $3 per sq. foot rebate which when you add together all the windows and sliders in the average home can be a nice little amount to offset the cost

SO.. I know that we are basically "broke" because we are mostly responsible with our money. It hurts to see friends spend willy-nilly on fun stuff, but we are on a budget to make ends meet and save some money, so I can sleep at night instead of worry about how to pay for things. I don't mean to say that we struggle or buy everything on sale or at goodwill, but we are cautious about expenditures, and avoid the daily-habit drain of coffee or lunch out- little things add up.

(And yes, we go to Disney, but usually it's under $1500 for two of us or $2K if all three of us travel. This fall's trip is a splurge.)

have a great time on your vacation

 

[MillauFr]

(SAHM)

????

what does this mean?

 

[SEA333]

????

what does this mean?

Stay At Home Mom

 

[wdw4rfam]

Why we are broke.....DISNEY.

 

[judydvc]

LOL. Doesn't anyone on the budget board know folks who are not "extreme" cases. Where are the people who wants some thing in the middle, a 2 year old Honda that he can make easy payments on that he won't have to worry about falling off piece by piece as he drives down the road.

HA! I have family at both extremes but like to think I'm in the middle with my 2009 Honda that I plan to drive until she quits!