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When I first began this debt-free journey, I adopted the Dave Ramsey method of throwing every extra penny, saved or earned, at my outstanding debt. A part of me still wishes I was doing it, but I soon realised it wasn’t sustainable. I’d love to know, what your mindset when it comes to money?
Financial Education Reading
I’ve read a fair few books on the subject, including The Total Money Makeover by Dave Ramsey; Money, by Rob Moore; The Richest Man in Babylon, by George Clason; and Get Out of Debt Now – The Easy Way, by Allen Carr, author of the other Easy Way books.
Similar to Dave Ramsey, Rob Moore is of the opinion that you need to throw everything at your debt before you can begin to grow your money in the opposite direction, and it makes total sense.
Yet, the books The Richest Man in Babylon and Get out of Debt (Easy Way), discuss paying off debt with a proportion of your earnings, while adjusting your spending habits and other misconceptions around money.
Which Money Method is the Right Money Method?
Both methods make a lot of sense. One will get you out of debt quicker, and the other will allow you some breathing space but will take longer to get out of debt. It’s a tough call, and one which no doubt depends on your circumstances.
It sounds like an excuse, but for us, we’ve been a single-income family for so long now, and in my eyes, the kids have gone without. I know we shouldn’t compare. We shouldn’t try to “keep up with the Joneses”, who are more than likely in exactly the same situation.
But there comes a time when you get sick of scraping by. Budget or no budget, you do have to make sacrifices. And you get sick of making sacrifices and want to be happy and enjoy your life from time to time.
I guess that’s why, every now and then, I throw caution to the wind and get a little spend-happy, then have to scrape by with money-saving meals for the next couple of weeks. I find it hard to say no to my kids, especially as historically I’ve said no to them because there hasn’t been enough money.
Increased Income vs. Debt Repayments
I’m earning my own money now, thanks to this blog and my writing business, and it’s allowing us a little more breathing room. But it doesn’t stop me from having a little mental struggle for not using that money to pay off debt, which I feel is the proper thing to do. Our budget has been tight for years, so having an extra income helps us to have a bit more money to enjoy, such as when we bagged a bargain break this December.
I don’t want my children to grow up thinking money is scarce, as I believe that deep-rooted mindset affects how you approach money throughout your life. We rarely had spare money growing up. We lived comfortably with an average-house and had an annual holiday, but there was rarely money spare. Which is where I think my “I want it now” mindset originally stemmed from.
Money Mindset and Habits
As soon as I was earning my own money at the age of 18, knowing I could borrow and pay it back with my monthly salary is, I believe, what put me on the debt-spiral. Only now, instead of using credit and planning on paying it back, it burns a small hole in my pocket. I think of all the things we need and want and feel that we’ve missed out on, and now that I’m earning, I want to use that money to pay for them.
With family life, I think money will always be tight unless you’re a dual-income family, which isn’t always feasible. That’s why I started this blog, as it’s time we had more options available to us. Cost of living is remarkably high, and such pressure on society to be everything and have everything is causing generations to fall further into debt.
Also, I don’t want my children to grow up believing that money comes from a bottomless well. I want them to grow up with a respectable love for money, and to understand that they can make as much money as they wish, but that they need to use it wisely and make it work for them.
What Do You Think?
What are your thoughts? When it comes to money, what’s your mindset? Are you a “You can’t take it with you”, type of person, or a “Look after your own future” type of person? Do you send all of your extra earnings to debt, or do you do what I’m currently doing and send a percentage, keeping the rest back for other living costs?
Everybody is different. What works for one person might not necessarily work for another. Let me know your thoughts in the comments.