Saturday, May 06, 2006

Struggling??

I read an article in the New York Times about how Americans are feeling the financial pinch of higher gas prices, insurance rates, adjustable rate mortgages, etc.

Let's be real for a second. Yes, I know costs are rising in many different areas. But, are we really hurting?? Who in our country is really "suffering" because of these higher prices? I just don't see it myself. Although I know there may be a few areas people are cutting back, I don't see it affecting a lot of our choices.

The New York Times article talked about forclosures on houses...over 40,000 in Texas in the first quarter of this year. Are the forclosures a sign of a depressed economy or a sign of people overspending and trying to be better than the Jones's, but now they can't keep up?

Several months ago I read an article in the Dallas Morning News that talked about how the majority of the forclosures were in the wealthiest county...the northern suburbs of Dallas. It talked about people around my age (mid 30's) who had purchased extremely large homes, big name cars, extravagant vacations, and then lost their job due to cutbacks and instability in the market. Some of the people were having to "cut back" and live on much "smaller" (still six figure) incomes. The couple interviewed said they were "embarrassed" to now drive a Volvo and Chrysler instead of a Mercedes and Cadillac.

I'm sorry, but I really don't have a lot of sympathy for that. I don't consider that "suffering" or "struggling."

In our country today, do we know anything about moderation? I'm not saying that I make better choices than the rest. I just subscribed to a two-year contract for satellite. That may not have been the wisest choice for me. Since I'm not bringing home a 6-figure salary, purchasing satellite television could probably compare to the people who bought too big of a home. If my income drops at all, I will still be commited to a 2-year contract and it would be a stretch for me to continue the payments. It's not like I couldn't do without enhanced TV. In my 34 years of life, I have never had any kind of cable service so I really don't "need" it now.

What do you have that you don't really need? And how could you use that money you would save?

I found out the other day that I could save $79,000, by paying more on my mortgage each month and paying my house off in 15 years instead of 30! Can I be disciplined enough to put off my immediate gratification wants? Do you know what I could do with $79,000! The real question is, though, not what could I do, but what will I do with it? Will I just chalk it up to having more money for cable, eating out, movies, and other personal entertainment or will I use it for helping a child get through college, contributing to public radio, or contributing to any other community-focused non-profit?

I know it's ridiculous to ask some top-level executives making up to $150,000 per day to give up their huge salaries in order to offer low-wage earners making $11,000 per year a better opportunity. We all love and can justify our money too much for that. However, for those of us who are a little more socially conscious, I think it's important for us to look at what we make and what we spend and realize how frivolous we can be and then adjust accordingly.
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