Rich People vs. Poor People

by Kristina on December 5, 2012 · 3 comments

Good morning Dinks. You may remember that I absolutely love the television sitcom 2 Broke Girls. One of my colleagues at the bank recently told me that he didn’t see the comedy in the television sitcom 2 Broke Girls and I told him that it’s because he has never been broke.  I have definitely had my share of financial struggles in the past and this may be why I can relate to the broke-ass lifestyle of 2 Broke Girls.

Different Strokes for Different People

If you have ever been broke and survived it then maybe now you look back on your former financial life and you can laugh about it.  But the truth is that being broke is not fun; it’s stressful and it causes many couples to break up.

Rich people and poor people deal with situations in very different ways.  If you used to be broke and now you aren’t then think about how you handled a situation when you were broke versus how you would handle the same situation now when you have money.  Little things like calling in sick and losing a day’s paycheck may not have been an option back then, but now you may have the financial freedom to take a day off.  When you are broke and live on a very fixed budget an extra little expense on your monthly hydro bill or telephone bill can be a huge financial burden.

Different Money Management Styles

My money management style has gone from not having any money to spend on anything to spending every single last penny that I made to now always debating the cost versus the benefit.  When I was making more money I spent money carelessly and unnecessarily.  Now that I live on a budget I am definitely more careful about how, when and where I spend my money.  I know that seems like a rich girl problem but it’s true.

I used to spend money just because I had money but honestly it was useless, remember my Honda car purchase? My overspending was not helpful and honestly it was pointless. I just ended up with a lot of stuff that I didn’t need and it was all just taking up space in my apartment.  I ended up donating a lot of it to an abused woman’s shelter during spring cleaning.

Saving Money is Relative to Your Situation

I know that we are all supposed to save money on a regular basis but how much money we can save is relative to our own personal situation. If we have less expenses we can save more money on a regular basis and if we have a lot of monthly expenses we will have to save less. This is just the reality of living on a budget.

Some experts say that we should save at least 20% of our monthly income and some personal finance bloggers preach about living on only one of your dual incomes.  The amount of money that we can all save is relative to our monthly expenses and our monthly income. How much do you try and save each month?

 Photo by taxcredits



{ 3 comments… read them below or add one }

1 James December 6, 2012 at 7:10 am

Kristina,

This is a really excellent posting. You are correct in that saving begavior differs a great deal between wealthy and poor. Most great fortunes are three or four generational endeavours with multiple generations successfully investing in the same business.

So i guess what i am saying here us the bottom line us uf you want to get ahead save and invest every penny you can. Over the long run it will pay off for you.

Best,

James

2 Stan Z December 6, 2012 at 8:41 am

This is a good article. I crunched our numbers and we are saving approximately 16% of our income monthly. When we retire several short term obligations (car payment, HEL, 0% credit card financing) we will creep to about 30%. That will get us halfway toward living off one income!

3 Kristina December 6, 2012 at 10:44 pm

@James – Thank you. I have been both with and without money and I definitely noticed a difference in my lifestyle.

@Stan Z – You are definitely on your way. Congrats and thanks for reading.

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