Numerous families debt free while earning $40k or thereabouts... You are exactly correct. People have much less control over their incomes typically than they do their expenses. Those same people often believe that if they only earned more, they would get ahead. Fact is, they wouldn't, because you can't fill the sink if you don't plug the drain.
We are not rich, I earn a respectable wage, our neighborhood is a solid $160k home neighborhood. It took us three years of focus to delete $140k in debt, with 2 kids in tow. If we can do it in three years, imagine how many COULD do it in say 6 years? That's twice the time, but that concept seems alien.
Last week we were sitting around a campfire, with some good friends, we love them to death. We were at their seasonal campsite ($3000), at their camper ($15,000), with both of their $30k cars sitting nearby. They are very frank, which I appreciate, because finances shouldn't be more taboo than sex, but we are taught not to talk about it... Why? People need serious help, but it's taboo to talk about it? Stupid.
Anyway, we were talking and they said that they had been looking at selling their home because they just cannot make it, they are really struggling to make ends meet. Wait... Wait... Their income is greater than mine, the only thing separating them and us, is choice. I'd choose to sell the camper, cars and rid myself of the campsite! Any income can leave you bankrupt, the only thing saving you from that fate, is spending, which in the US, is a huge friggin problem. It's a psychological problem.
They look like the wealthiest people on the street, I look like the most destitute (until I pull out my S3)... It isn't rocket science, it's addition and subtraction, it's not theory, it's something you learn in 1st grade.
Cash is for toys... Debt is to be avoided, and only used for a necessity. 75% of Americans claim that they are either living paycheck to paycheck, or falling behind, so what does that mean for their children, their futures?
My kids are excited about becoming debt free, my daughter is at that really impressionable age, she sees what is happening in our home, our family, she listens to our conversations about responsible money management, every day. Money, finances, are not taboo in our home. Our household budget is hanging prominently on the fridge where anyone can see it. It's a fact of life, of our lives, it's a reality, it's not a dirty secret, it's information and knowledge that needs to be shared.
Do you think my father in law feels good knowing that his daughter has me providing for his daughter and grand kids? Yeah... I only hope my own daughter has someone as committed to her security. And if not, I will punch him, weekly, for being a moron and risking the futures of my daughter and her kids, and for what?
I train a lot of pilots, from many countries. It is interesting the aversion to debt that foreigners have in comparison to the American view of debt. Their upbringing was different, they were socialized differently, their values were placed elsewhere... It really makes for some very interesting trans-cons!
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