The Invisible Rich
Posted by Gail | Filed under Balance, In the News
I am completely thunderstruck by the number of people who believe that spending money to look wealthy is better than keeping money to BE wealthy. I get that kids might equate the outer trappings of fine clothes and an expensive car with being well off. But, com’on people, once you get to be older than a teenager, doesn’t it become obvious that having money in the bank is the key to building wealth?
Working with Princesses has really brought home just how much people buy into the “image” message. I’ve met chicks with thousands of dollars worth of designer shoes and not a penny in emergency or long-term savings. Looking good seems to have replaced common sense. Oy!
Once upon a time when you saw a doll in a snappy Diane Von F. dress sporting a pair of designer heels, you could assume she was making (or married to) some pretty big bucks. And if himself sped by in a BMW, you knew he made enough to be able to afford the mortgage-high lease rate. Not any more. Now Poor Joes and Shopgirl Susies are sporting the most expensive toys. And they’re doing it on credit. So not only do they have nothing saved, they’re actually mortgaging their futures to maintain the images they so wish they could actually afford.
The biggest stumbling block to becoming wealthy is pretending you are. The cost of keeping up the image of success – the cool digs, the snappy clothes, the fancy dining – erodes the saving you have to do to put a positive spin on your balance sheet.
Wealth doesn’t just happen. It takes conscious effort. The truth is that while most people say they want to be wealthy — or even debt-free — they really just want other people to think they are. And so we have a culture of designer wear being sported be a crop of Wannabes.
People are always saying one thing and doing another with their money. Whenever I write about how important it is to save up a 20% downpayment for a home, it’s often followed by a barrage of email from people who say they’ll never be able to buy a home because they can’t afford that high a downpayment. Yet if you look at what they’re spending their money on, the reason they can’t save becomes pretty clear: they’re so busy shopping they have nothing left to save. If they cut back on their spending, and set a reasonable expectation for their first home, they could own their first home in about five years.
Now comes pressure from the Big Five Banks for the government to change legislation to make minimum downpayments higher and maximum amortizations lower. Hmmm. Seems we don’t have the good sense God gave a goose and we need new legislation to protect us from ourselves. Ouch!
Books have been written about the Invisible Rich: the people who live simply but have a bucketful of money stashed away. These people do not feel the need to define themselves by an expensive car, shoes that cost the equivalent of a mortgage payment or table-service at the snazziest club in town. They know that the only way to build wealth is to live well below their means. They put their financial independence well ahead of creating the right social image. And they work hard.
Frugality isn’t a dirty word among people who desire to be wealthy. They would rather live within their means and save a substantial portion of their income than bathe in the covetous attention of their friends and family.
Hey, if you’re happy spending every red cent you make, then you should do what makes you happy. But you can’t then whine about it when crap hits the fan and you have no cushion, no options. And if you’re determined that this is the year you finally take control of your money and your future, then it’s time to walk the walk instead of just talking the talk.
We all have the option of taking immediate gratification over the long term security that setting aside money brings. And yes, a shiny new car is a lovely thing. But it doesn’t beat having a big, fat F-U account. Like the ad says, “Sleeping well at night: Priceless.”
February 9, 2010 at 6:38 am
In an article on marriage I read about true wealth. The writer said that everyone comes to a marriage with baggage and you can only hope that in those suitcases is a solid upbringing, good sense, and a caring conscience.
February 9, 2010 at 6:48 am
Oh Gail,
I find that at one point or another, most of us have been THERE and ended up paying dearly for it!
Growing up in a very low income family (as did many of my former peers) once I tasted the trappings of the “image of wealth” it was…ADDICTIVE! The clothes, the restaurants, the chains…the list can go on.
However, at one point, besides being up to my eye-balls in debt, I realized that: IN ORDER TO GAIN TRUE FINANCIAL WEALTH (and to avoid poverty again) ONE MUST CONSERVE THEIR MONEY, NOT SPEND IT!
The media plays a large role in depicting high-living celebs as being those that spend vast amounts of money like water; but realistically, we’ve all seen what happens to those who do: they go BANKRUPT!
As I got older I came across very modestly-dressed individuals who are very fianancially-comfortable. They don’t pine for those silly, unnecessary items that only last a moment.
Long story short: IMAGE simply isn’t worth the sacrifice of one’s FUTURE.
Have A Pleasant Day, Everyone!
February 9, 2010 at 6:50 am
This post certainly speaks to me! I have the EF, the planned spendings, etc, but I drive around in a crappy car.
Where I live, probably like most places, the car you drive really matters! So everyone assumes I am poor. Some days I want to wear a sign on my forehead that has my (healthy) bank balance on it. Other days I think seriously about going into debt so I can buy a big new car just so people don’t think I am poor!
Stupid I know, but it is a real challenge for me not to buy into this looks vs. reality, especially at the school gates when I see all those beautiful shiny big new cars.
February 9, 2010 at 7:27 am
You have overlooked one of the reasons for the splurging on designer whatnots. The sex/relationship courtship game. Biologically, women are programmed to look for partners that can provide resources to them and their future progeny. Historically, this is done by seeking those with symbols of their status – i.e. expensive watches, nice shoes, cars, what-have-you – as this is the easiest way to gage a person’s level of resources (in the older days anyways). Those with wealth consciously or unconsciously will display it to some degree. So, these days (or any time in history), if you want to be a man who can champion a few women, then signs of status are essential to getting that attention. Likewise, women go to great lengths to stand out from the others to show that they would make a good “breed” and attract those with “great wealth”.
Marketers just play off of that – just look at any Gilette commercial or Cosmo magazine. The difference these days of course, is that credit is so easily available that it just has exagerated that game to the point it takes ultra wealth symbols to standout – i.e. everyone seems to have a BMW these days, so now it’s Porsches, Ferraris, Bentleys to truly standout (just look at any hip-hop video). This escalates and now, you have partially explained this phenomenon of huge CEOs bonus structures.
February 9, 2010 at 8:06 am
I’m glad my wife and I are living frugally. eventually we wil become one of the invisible rich you talk about. When I die and my children get access to our banking information I want them to be surprised. There is no need for BMWs are the fancy designer stuff. I’d rather have money in the bank.
Regards,
Jason
February 9, 2010 at 8:32 am
I would think that at some point there has to be a pendulum swing back to a more sensible lifestyle. Marketers sell this stuff because we buy it. At some point, maybe we just won’t buy it anymore. We saw just a bit of that at the height of the financial crisis. Frugal, for a brief moment, was fashionable.
At some point, I think we will see another crisis and I think that one will stick. Perhaps that’s what it takes for people to realize that buying stuff you can’t afford won’t make you happy, but integrity and honesty are very gratifying and can actually give you a greater sense of freedom.
February 9, 2010 at 8:39 am
Amelia I like your post. How true.
Sometimes it’s hard to avoid the *stuff* trap. I love pretty things! BUT I love having no bills more. I’m working on having money in the bank. It’s going to take a while, but it will be worth it.
I refuse to fall into the bigger is better housing trap, or the latest greatest this or that trap. IF I could afford it – wonderful!! BUT I know I can’t. So while I can afford what I have, I will enjoy it and not take my sweet *little* house for granted.
For me, it’s all about my short & long term goals. I don’t expect to ever be wealthy. I just want to be comfortable. I also have to remind myself that I don’t have to have it all right now. For example, we built a cottage. The structure is done and it’s a place to get away to. It is basically a ‘camp’ at the momment as it still needs wiring, insulation etc – but we don’t owe a red cent on it! So if it takes another 10 years to be what we want it to be, than that’s okay because we appreciate having it and take pride in not going in debt for it.
Sometimes I get new car envy too, then I shake my head!!! My car is 3 years old – hardly old! I’m driving it to the ground!
I look at my grandparents who are in their 80s. They have a nice little house and they have always been content with what they have. Yes, the house could use a few upgrades like new kitchen flooring and new exterior doors IMO, but they are happy. They never owned a car, don’t even have a microwave – but they never wanted it. They could have easily bought those things, but they chose to be happy with what they had. When they buy, they chose quality and they don’t waste.
February 9, 2010 at 8:44 am
I just read 2 cents post and thought of something else!
I have a co-worker who chooses to spend on whatever she wants and travel every year on credit. She takes full advantage of her home equity and borrows are the best rates she can get. Her justification is that all of her debts are insured. If something happens to either her or her husband, the debt is covered so why not live it up? She feels she can afford the monthly payments.
So, if she can sleep easily at night because her debt is insured so be it.
I am interested to know if she has any emergency savings… I can almost 100% say it’s a LOC.
To each their own…
February 9, 2010 at 8:45 am
I think it’s possible to have a little of both, if you have a balanced budget, a solid EF fund, money in savings and 10%+ going long term savings them enjoying some of your gains can’t be all bad.
February 9, 2010 at 9:25 am
Nice post Gail. I get this envy sometimes too of “stuff” other people have. My car is 11 years old. I like the look of designer shoes, clothes, etc but cannot justify spending the money to get them.
I’m still a happy person with what I have and that is what is most important.
February 9, 2010 at 10:11 am
I love the idea of being invisibly rich! I’m working on it. When I learned what my Nana has in the bank when she passed away, I couldn’t believe it-she lived in the same house from the day she was married, she wasn’t into fancy stuff, she was incredibly frugal, but also generous with her time and resources-she helped my brother and I with RESPs etc. Just goes to show that you can be totally comfortable and still have a great life.
February 9, 2010 at 10:13 am
My husband and I are both highly paid professionals. Our co-workers indulge in the lifestyle they can “afford”. Think very expensive cars, vacations, clothes… The money comes in and goes out at a very high rate. The pressure to buy into this lifestyle surrounds us daily.
We dabbled for about a year in the high spending lifestyle, and realized it did not make us happy. Happiness comes from the people around you, not the stuff you have.
After our trial super spendy lifestyle period, we choose to instead adopt a more frugal lifestyle. We keep a budget, dress our children in hand me downs (which look just as cute thank you very much!), brew our own coffee, live in a small home, and vacation close to home. This is the life that feels right to us.
It can be hard avoiding the temptation monster, but it is worth it at the end of the day when we can sleep soundly. Because of our lifestyle choices, we are in our mid 30’s and have a net worth of over $1 mil. And we did it through smart choices and saving (even when we made very little money and through periods of unemployment).
I guess we are the “millionaires next door”!
February 9, 2010 at 10:20 am
It’s funny, I have no problem telling family – even strangers listening in – “hey look we’re poor, we can’t afford this”. you know, all the stuff you learn in kindergarten is true your whole life – “your friends should like you for you” and “you shouldn’t have to give things to people to get them to like you”. Still true.
But Gail I do disagree that it’s possible for anyone to save up 20% downpayments in 5 years. It’s very hard to do so while paying rent/life, etc. A (typical) $400,000 house in Toronto means an $80,000 downpayment plus you’ll need about $15,000 minimum for closing, land transfer tax, moving, yada yada yada plus the inevitable updating. I know you’d say it’s cheaper if you live outside of the city but I maintain that a 2 hour commute from Oshawa/Pickering/Brampton will murder a lot of people’s relationships. A 10% downpayment is more doable.
February 9, 2010 at 10:20 am
I agree with Goal O Debt,
the idea isn’t “he who dies with the most toys wins” but neither is it
“he who dies with the most money in the bank wins”.
I think the idea is that you have sufficient money to keep a roof over your head and to care for you in your dotterage. Nursing homes, home care nurses, prescription medications, hearing aids, mobility aids, etc all cost a great deal of money.
Yes, it would be nice to leave some cash for our children, but the idea is to ensure you live well until the end, without bankrupting your children.
Retirement savings are not just for golfing vacations. Conversely, we only have one life and ought to live as fully as we are financially able.
February 9, 2010 at 10:21 am
Ah yes, image… impressions…
I know many people that project the ‘rich’ image, but are in debt up to their childrens’ eyeballs.
The people I know that actually have some wealth have gone to the opposite extremes though. Looking like a bag-lady or a homeless man while having $1M in the bank.
I honestly don’t envy people their flashy clothes or fancy cars or far-away vacations. Hubby and I like living comfortably, simply, happily… To each his own. We sleep well at night. And we will not have to call on others in a crisis.
February 9, 2010 at 10:23 am
Geoff, housing prices are crazy in BC, as well.
February 9, 2010 at 10:26 am
@ Diana – your province is crazier than Toronto prices. But it is lovely, compared to our dreary city (and I love Toronto, but Vancouver kicks its butt).
February 9, 2010 at 10:49 am
It’ll kick the world’s butt in a couple of weeks, ha ha!
(then the provincial government will need Gail’s jars!!!)
February 9, 2010 at 10:52 am
What a spunky post! A big fat F U account… I love that! I’m working on getting one of those!
February 9, 2010 at 10:54 am
Hubby and I continue to live very frugally since his being laid off last year. While it is wearing at times, we are immensely satisfied knowing that we continue to pay down our student loans and we are pretty much debt free other than that. What is exciting for us is knowing that when the market turns around and we have two incomes again, our whole financial picture is completely changed. We will likely give ourselves a little more leeway, but we will also have the opportunity for the first time in our lives to have a real savings account!
His being laid off was a valuable experience in that regard.
February 9, 2010 at 10:55 am
I can’t wait for your new show, Gail!
February 9, 2010 at 11:07 am
We seem to be surrounded by “gifts” people. Every time we turn around there’s another “occasion” to give a gift. My husband and I are practical and don’t like wasting money buying something that a someone will not need, like or want, just to say we bought something. Spending time together is more meaningful to us… however, those someones seem to want to buy us things we don’t need, like or want on a regular basis. We try to request (read: tell them) that they should not buy us anything, but the gift arrives inspite of that. I have to wonder sometimes, what that gift means to them – is it their way of “looking richer than they are?” because I know they cannot afford it and it pains me to accept a gift that I’m certain was bought on credit.
February 9, 2010 at 12:12 pm
Absolutely right on Gail. We figured this out years ago after we got married and you definitely know it after you have kids.
We don’t really care how we look, as long as it’s respectable. Living in a smaller town with less peer pressure also helps.
Driving a car? We intentionally bought a used car so that we could pay cash for it.
I’d rather sleep well at night than have to sleep poorly AND maintain an image.
February 9, 2010 at 12:13 pm
My husband and I are in debt because we are self indulgent on a small scale. One of the TDDUP’s Gail called a couple “the $10 kids”. That’s like us. Well that was us.
We never wanted to say we couldn’t afford dinner out so we would just put it on credit. When we get extravagant with our spending it has been on vacations or putting in new floors. The worst thing we did (or dh did) was when he got his promotion 3 years ago he insisted he needed a new car because everyone in his position had a new car. He pushed me to buy it even though it meant we couldn’t afford for me to be a saty at home mom then. It cost us the equivalant of 1/2 his promotion for 5 years. It is now rolled into our current house. A week or two later he realized what he did but it was too late. Then we sold our townhouse and bought a small duplex because the place made dh closturfobic. So I told him that with these changes we would be needing to be more staying at home etc… He agreed but did not change any of his habits ( drive-through food, snacks, dinners out). He didn’t understand why he couldn’t when he made good money. So we where “debt-free” again just under 3 years ago because we hid it in the new mortgage and now we are in a lot of debt again.
Thanks to Gail’s show, her book and this blog/website we are on the right path now.
My husband has always insisted that he isn’t trying to keep up with the Jonses but maybe he just has unrealistic expectations on what life should be. At least he doesn’t want designer clothes and a Mercedes!!
February 9, 2010 at 12:14 pm
Once, in university, my professor walked into class one day in a bit of a huff. He was annoyed that the driver of the cab he had just taken had tried to take a long route; my prof had to argue with the driver before taking his preferred route.
After class, my classmates chatted about that story. One wondered why this prof – a wealthy entrepreneur – didn’t just let it go and give the cabbie the extra money. Another classmate said, “Because, you don’t get rich by giving away money for no good reason.”
February 9, 2010 at 12:17 pm
Interesting. I first heard the phrase “F-U account” a couple of years ago during a Tyra Banks interview. Tyra’s mom had told her when she was younger to have one so she could leave a relationshiop with a man when and she needed to and take care of herself…in other words so she could tell him “F-U!” I guess the phrase is getting around and next to teaching our girls about self-respect – first and always – and hopefully the rest will fall into place.
February 9, 2010 at 12:18 pm
Apologies for the terrible grammar for my above comment but Im sure the general message is readable.
February 9, 2010 at 12:41 pm
Great post Gail. Reading the book _The Millionaire Next Door_ a number of years back confirmed by suspicions about who was truly wealthy. It’s definitely not who you thought when you were a teenager!
February 9, 2010 at 1:46 pm
Your post today is thought-provoking, Gail. Much of your message is about prioritizing what’s important in life: you can have it all, just not all at once, as you say. Being financially rich isn’t one of my goals in life; instead I want security, with a healthy emergency fund, good insurance, and enough money socked away to retire in my mid-60s in case that is necessary. (Otherwise I’d rather ensure that I’m in a job that I enjoy and continue working so long as I am able. I’ve seen what retirement in the early-to-mid 60s has done to my parent’s generation, and they seem less happy than when they were working.)
My priority is to travel while I’m young and relatively free of obligations. I’m willing to be less financially wealthy to achieve what is, to me, an important part of my overall wealth in life. I will pre-pay all my travel, NOT put it on credit. This year I’m taking my first non-academically related trip to Europe, on my own, for three weeks, and I’m fine with spending a bomb on that because a) I’ve got the money in the bank and b) it’s more important to me than topping up my RRSP or saving for a condo.
February 9, 2010 at 2:30 pm
Congrats Scarlets Mom! Quite an accomplishment so early in life.
I’ve looked and don’t see an Net worth calculator among the tools Gail has available, and that might be a good addition. I keep track very simply on an extra tab within my budget spreadsheet.
There are different philisophies on what to include and exclude from the calculation. I personally do NOT include the equity in our home, our vehicles or RV or any other “stuff”. I count only cash and investments. The logic behind this method is that unless something can be rented out, or sold quickly it should be excluded. We have at least $300k equity in our home but unless I remortgage the house or sell it that’s irrelevant. We own our vehicles and camping trailer outright but they depreciate with every passing day and their “worth” is only a guess at best. Assessing the value of the “stuff” in your home is another mess entirely. Yes it cost you money, yes it could be sold for something but likely nothing close to what you paid. Including the value of your engagement ring, for example, in your net worth seems crazy to me unless you actually consider it an asset you are prepared to sell. If you’re going to include any of your “stuff” in your net worth make sure you only include what you could sell it for, not it’s replacement value.
I list all our major assets on my list so I can see the total value of our stuff, but don’t include them in the total net worth calculation.
Gail – Maybe a future post on the pros and cons of various ways of calculating net worth?
February 9, 2010 at 2:36 pm
Gail,
I’m very much looking forward to watching Princess. What interests me the most is the difference in lifestyle needed when one is single as opposed to married.
When you’re married, you’re sharing expenses with another person’s income or, for the stay-at-home parents, at least having the possibility of another income coming in. When you’re single you have to pay for every single thing yourself, (including a full mortgage and all bills) and can only work so many hours in a week, so I would think that you wouldn’t have the opportunity to save as much (in terms of amount) as a couple would.
I’d love to see a blog on the differences between a single-income and a dual-income household, and how different each household’s lifestyle would have to be in terms of housing, transportation and the amount each household would have the ability to put towards retirement, EFs and savings.
February 9, 2010 at 3:41 pm
I have never wanted to be rich or wealthy or what have you and I have never wanted to be these things to buy material items.
I have always wanted to financially comfortable and flexible. I want to travel when I retire and help my kids with their post-secondary education. I don’t want to lose sleep over a car repair bill or have to think about being a couple paycheques from being homeless.
We have a nice security fund right now in case something like job loss or illness comes up so I feel very blessed that I don’t have to worry or lose sleep over these things but I do worry that one day that fund won’t be there and we will need it. This probably comes from having a very financially unstable upbringing. Something I will have to get over.
February 9, 2010 at 3:47 pm
Thank you for your blogs. I truly enjoy reading these! My husband and I are in our 30’s and live well below our means. We save 1/3 of our gross income and live very comfortably. We do not buy anything that we do not “need” but at the same time, we do not sacrifice on family activities and programs the children are interested in joining. We live in one of the least expensive houses of an expensive town in New Jersey, USA. We chose this town for the great public schools. Our neighbors probably think we’re poor because we live in a small 3 bedroom ranch and drive a 10 year old car but true friends will not care what you drive or the size of your house.
I also want to tell Geoff that if there’s a will, there’s a way. It is possible to save 20% down payment before you purchase a house. When my husband and I got married, instead of spending thousands on a wedding, we saved up for a 20% down payment on our first house. We got married in front of a judge in the courthouse for $50.
February 9, 2010 at 5:01 pm
I’ve had people who call me cheap, frugal, miserly and all the rest and at times it drives me insane. Who are they to judge me by how I choose to spend…or save my money?!
I just have an attitude that I don’t spend money on stuff I can do myself like making a lunch as opposed to eating out all week, making coffee at home, cleaning up my own home as opposed to hiring a maid, even some minor auto maintenance (thanks Dad for those skills). I drive an older vehicle that makes me smile whenever I drive it because it costs me little to run, maintain and insure and gets me where I’m going. Plus it doesn’t look like every other SUV and BMW in the parking lot and that car payment each month stays in my pocket.
I look to my elderly mother who is one of the happiest people I know. She lives a great life, has terrific friends, a wonderful companion in her pet dog and has want for nothing. It all starts at home and my parents instilled me in long ago that it’s not what you make, it’s how you spend it.
Just my 2 cents (which too are staying in my pocket)
February 9, 2010 at 5:18 pm
Wealth is a state of mind. That being said, someone that is engulfed in debt without a pot to pee in cannot say they are wealthy. However, to the person that has lived a life managing their money, they have all of lifes necessities and are happy and content to me that’s wealth. Yes, the large investment portfolio, real estate assets and so forth are all good in themselves, but if you’re not happy and content in the end, have you found true wealth?
February 9, 2010 at 6:03 pm
Funny, there are Invisible Rich people out there, but I dread to think of how many Invisible Poor there are! They can barely make that mortgage/car/cc payment but they still dress and act the part of being rich…
I believe there has to be a balance. Just like you shouldn’t spend every single penny that comes into the house, but you also can’t save it all either. One smart poster above was spot on when he said ‘you can’t take it with you.’ It’s so true!
On a side note, Gail you are an inspiration! I turned your show on at my boyfriend’s house the other night and he really got into it. He doesn’t buy into ALL of your advice, but that’s ok because he’s good with his money and not everyone has to fit the cookie cutter mold, but he loved your attitude and realism! Watching just that one show turned into our own Relationship Rescue and we really discussed who we are and where we are going in life. Not a single mention of money (how often do you hear that? lol) but you have now had a profound impact on our relationship. Thank you
February 9, 2010 at 6:58 pm
Great post Gail! Last year I picked up The Millionaire Next Door and was quite suprised reading about who were the wealthiest people in North America. A very eye opening read.
I used to be a Shopgirl Susie back in highschool and part of university. Now that I work for myself, it’s Frugal Fran!
Congrats Scarlett’s Mom! I hope my husband and I will be able to say the same things about ourselves in a few years. We’re learning every day how to live a happier life without having to spending $$$
Looking forward to your new show Gail
February 9, 2010 at 7:40 pm
I think people have taken the message “dress for the job you want, not the job you have” too far!
PS, I have a BMW. But it’s a second hand car (in great shape) that I saved up for YEARS to buy CASH!!! (what a glorious feeling that was). I just hate paying interest so much, that I was willing to delay gratification by driving a rusty (but reliable) old VW for a few extra years to get the car I wanted. This one just fell into our price range — barely.
Can’t wait to start seeing Princess episodes!
February 9, 2010 at 9:21 pm
Rhiannon I love your idea about Gail showing information about the difference between single and double income households. Maybe my friends and family would get a better understanding of what I have had to do to pay off all my debts, repair my house, save for what I wanted to buy, and why I have had to say “I can’t afford it right now” since I am single and on disability. But stangely enough I am doing financially better than they are.
I too can’t wait to see your new Princess show. I wish I could see the T’il Debt do us part US but unfortunately cnbc show me previews, show it on the guide but they always put another show in its place. Is anyone else able to see it in Canada via their TV?
February 9, 2010 at 9:22 pm
I forgot to ask, what is a F-U account?
February 9, 2010 at 11:20 pm
Anne – an F-U account, is like “Mad Money”…..it’s money we squirrel away (usually without telling the spouse/partner/etc) in case the relationship doesn’t work out. Then you can tell them “F U!” and have the money to be able to leave the relationship and not be cornered in a bad relationship simply because you can’t afford to leave.
February 10, 2010 at 12:34 am
Scarlett’s Mom said
“After our trial super spendy lifestyle period…”
I guess most of us go through such a period, don’t we? I think what makes the real difference in how we end up is how quickly we learn the lesson Gail’s talking about here: pretending to be rich will make you poor, but pretending to be poor will make you rich.
“Youth ages, immaturity is outgrown, ignorance can be educated, and drunkenness sobered, but stupid lasts forever.” — Aristophanes
I don’t know about anyone else, but I’m just glad I was only being immature and ignorant.
February 10, 2010 at 12:48 am
Amen, Gail! I’ll happily drive my perfectly serviceable 10-year-old Honda, and keep my F-U account. Watching TDDUP really taught me that there is a big difference between APPEARING wealthy, and BEING wealthy. Given the choice, I’ll take being wealthy any day.
February 10, 2010 at 7:53 am
Anne, my FU Account is my emergency fund. It gives me options since it means I don’t have to keep doing same old same old if it’s no longer working for me. Whether you plan to disengage from a partner, leave a job, or simply negotiate a better way of working with the people you already work with, having the option of being able to walk away and know you can still keep a roof over your head means you are in control. Money in the bank gives you the power to be in charge of your own life so you can say FU to anyone who tries to screw with you.
February 10, 2010 at 2:50 pm
great calculators to play with – have fun
http://www.dinkytown.net/
February 10, 2010 at 8:14 pm
Gail wrote: “And yes, a shiny new car is a lovely thing. But it doesn’t beat having a big, fat F-U account. Like the ad says, “Sleeping well at night: Priceless.””
Words to live by. I’m always quoting Gail from the show where she told the man:”nothing matters less than the vehicle in your driveway.”
If people purchased cars for economy – rather than to impress – it would help the environment as well as their financial health.
February 11, 2010 at 3:55 am
[...] [...]
February 11, 2010 at 10:17 am
[...] [...]
February 11, 2010 at 3:37 pm
My partner and I were actually talking last night about buying our first home and I said, “And of course we’ll have to save up at least a 20% downpayment” and he was shocked and said that he didn’t think we’d ever own a home if we planned on a 20% downpayment. I told him that I wouldn’t buy a home without it. Anyway, I then took 10 minutes to make a budget that would have us out of debt in 1.5-2 years and have the downpayment in 3. (We were only planning on buying our first home in 3 years anyway).
People always think that living on a budget is restrictive but he actually was shocked at how much money I had allotted to spending/entertainment, transportation, etc. With any luck he’ll be inspired enough to agree to it!
Thanks Gail for your inspiration.
February 12, 2010 at 7:02 am
[...] The Invisible Rich @ Gail Vaz-Oxlade [...]
August 24, 2011 at 12:27 pm
[...] The Invisible Rich – Gail Van-Oxlade Blog [...]
September 8, 2011 at 2:07 pm
I thought this would be about exposing those who have billions/millions –names, location–why do we let this occur when others have nothing. I know I know . capitalism. no kidding that’s how you get rich. who cares? Equal Money is the only sane, compassionate answer to the starvation of millions of children a year on this planet. Shame on us!
November 14, 2011 at 5:21 pm
Thank you for the great info and responses. I have learned alot by reading all the comments.
I was made aware that we are in Canada now where you are not obliged to buy expensive gifts for people just because you have the money or look like you have money. Crazy as it seems, this has been a big hurdle for me to undo what my mom told us was the way things are done in the old country. Eg. If you can bring a more expensive present then you would be seen to be a more popular sought after person to invite and hence more people had to respect you because you were rich.
I have spent many years feeling resentful for being one of the invisible rich people among my peers and always hearing my mom’s voice in the background making me feel guilty if I did not throw money in larger and larger amounts into gifts for people who had jobs but who were just not a highly paid as I am. Do we do that to feel better about ourselves or does it just cause others to be more embarrassed to receive a generous gift because they cannot reciprocate? Why is a meaningful small gift from a friend who’s income is not so high acceptable to me but my extravagent gift which cost more money has the be the minimum standard I resentfully set for myself because I don’t want my friend to think I am cheap. Not just the gift is involved because I am guilty of picking up the bill for meals out too because I feel guilty that I make more money than they do. Now that I do not have as much disposible income as before due to other financial obligations such as meeting my net worth goal of paying down our mortgage as fast as possible, I wondered if these same friends would not like me as much as before when I paid for most of the going out times we had together. I don’t want Christmas and Birthdays to be “pay offs” times that I resent each year.
Thank you to all for the comments on this posting that help me see that its totally ok to be one of the invisible rich who can give a less costly gift to a friend and not have to worry about them thinking I am cheap or are being selfish by not sharing more of my wealth with them as an expectation to the “THEY” who are out there. I have learned that this intangible “THEY” factor that I fear is just stuff in my own head. I have to give my head a shake and grow up to dispell the wrong thinking and nattering voices in my own head which stem from what I learned from my mom’s actions and opinions growing up about money and wealth.
True wealth is being happy with what you have. True wealth is being around friends that you like who like you for you (and not just for what you can get for them or pay for them). True wealth is NOT spending everything you have to buy people’s love, admiration or friendship by sacrificing your own net worth goals in the process of feeling obliged to keep the gift $ amount bar go higher and higher.
Wish everyone all the best in staying strong in your convictions, reaching your goals even if they are against the norm of a consumeristic societal message, and living a life that is wealthy in love, security and peace.