When I was in middle & high school I really wanted to attend the University of Notre Dame. I was born and raised near the campus, grew up going to sporting events there, and like most kids from South Bend… I knew Notre Dame was a special place and I wanted to be part of it.
But I didn’t go to Notre Dame. I didn’t even apply. You want to know why? Because I knew I couldn’t afford it. (And I probably didn’t have the grades to get in.) Even if I had been able to get in I would have had to take on an enormous amount of debt to get an undergraduate degree from Notre Dame.
Principle: Instead of worrying about what you can’t afford make the most of what you can.
Everything Isn’t For You
When we first got married Kristen and I lived on the edge of the Gold Coast neighborhood of Chicago. Kristen worked at a store in a high-end mall and I worked in an office building near the loop. So all day, every day, we saw rich people. These were people who had really nice homes, drove really nice cars, and had nice things. And we dreamed of one day owning a walk-up brownstone in Lincoln Park… and Kristen fantasized about owning a Range Rover Discovery… (OK, she still wants that 1997 Discovery) and I really wanted to own a Rolex watch. (OK, I still do.)
But it was a fantasy. We never actually tried to buy those things. Nor did complain about those things being out of our reach. Instead, we were content, careful, and thankful for what we had.
Next June we will celebrate 25 years of marriage. Financially speaking, we’ve been quite content living within our means, keeping our eyes on the big things, and exchanging a lot of immediate gratification for long-term goals.
Principle: Be content with what you have but splurge on small stuff along the way.
Long-Term Goals Trump Short-Term Fun
Here’s the thing. Over the past 10-12 years we’ve lived beneath our means. We could have afforded a bigger house. We could have taken our kids on cruises or to Disney on vacation. We could have bought nicer cars. We could have leveraged good credit to do a lot more improvements on our house.
At the same time, we have a house we love that’s been a great place to raise a family. We’ve gone on plenty of awesome vacations within our budget, always paying cash. We have cars that are just fine. We are making improvements on our house with cash, not credit.
We have always had bigger goals in mind. We now have two adult children in college who are on paths to graduate from good universities completely debt free. (They are doing their part by working part-time, keeping their grades up to maintain financial aid, and graduating on time.) Through careful planning and discipline we’ve gotten ahead on other long-term savings goals like retirement investments and getting our primary mortgage into a healthy and sustainable spot. And because we were intentional about when and where we bought our house we’ve seen it’s value go up.
Yes, I’m happy to report, those two broke kids who got married at 21 are doing better at 45 years old than they could have imagined.
And we’ve done that while earning fairly normal wages for where we live. I mean, we’ve worked for churches, nonprofits, and a small business that served churches & nonprofits. We’re not hedge fund managers! Comparatively speaking, we’ve always kind of been in the middle income range… but we’re getting ahead of people who make more money because we’ve managed our income like a couple billionaires.
Principle: The tortoise wins over the hare every time.
Ignore the Noise
If I can accomplish long-term financial goals, so can you. You have to learn to look at the naysayers, the people who cry about how expensive everything is (education, housing, whatever) and focus on doing what you have to do. There will always be people looking for a short-cut. If, along the way, you stumble upon a short-cut, cool. But don’t plan on it. Mom was right, “If something seems too good to be true, it probably is.”
Instead of focusing your energy on what you can’t do, enjoy what you can do. Contentedness comes from within. If you aren’t content with what you have and what you’re doing it doesn’t matter if you’re broke or rich, you’ll still be miserable.