Monday, June 02, 2008

When Wealthy, Don't Live Wealthy

If in your lifetime, you happen to become wealthy, take care not to LIVE wealthy, as it is far too inconsiderate to society as well as yourself.

If you watch the shows about the rich and famous, you will see lavish decor, spacious accomodations, beautiful gourmet foods - and absolutely ridiculous prices.

If you are a middle-classer (or lower) then you have learned to budget, to price compare, and to NOT buy what you don't need, and most of all - to buy where it is the cheapest for the best quality.

Just because you become wealthy, does not mean you have to start living lavishly. Instead, keep your habits the same and follow these guidelines:

If you enjoy your job - continue to work. Maybe cut your hours back if possible. Having a job sets an example for your children. You don't want them to get the idea that they may not have to work to live. If you don't like your job - create one out of home. There are lots of out of home possiblities. Now that you have the money to invest in one, choose one, or make your own. Everyone has dreams of doing something - follow it - whether it be writing a book, investing in real estate, making things and selling them or running a charity.

Upgrade your car, a new car is always nice to have, there's less maintenance costs, better gas mileage and of course it just looks nice too. Get a new work car - but keep it small and economical. After all, it's just for going back and forth to work. No need to get a Lexus or Jaguar just because you can afford it. Unless of course, they are getting the best gas mileage or least amount of maintenance - or other economical reason.

Get a family vehicle (assuming you have a family). A new car for the family is nice, for the same reasons as the work car, but also because you can now get a roomier vehicle. One that fits the family comfortably and has room for cargo. Again no need to go luxury brand, unless it's the most economical overall.

As for kids, if they are of driving age, make them earn their car. Don't just buy whatever they want. Make them work for half the amount of the car, and match what they earn. Then buy a used car for their first vehicle. Because the first car is going to get beat up - even if your child is not a drag racer or wild driver. The probability that something will happen in their first couple years of driving is pretty high - they are inexperienced. After a couple years with a good driving record, then consider assisting them in purchasing a new car. Of course, they'll need a steady job to foot the payments. You don't want your kids to become spoiled and not learn the difficulties of real living. So it is best to teach them while they are still under your roof (and under your protection) so that if they falter, you can be there to support them while they build themselves back up.

Upgrade your house - but keep it within normal upper middle-class limits. Make it roomy for the family, but don't have countless extraneous rooms. A large yard is nice - so a nice ranch or plantation type property where you have lots of land may fall in to order. Of course if your dreams are to own a property where you can run a bed and breakfast, or a private artistic or vacation retreat, then go ahead and get a place with lots of rooms or guest houses.

Create an emergency account - and put a substantial amount in it. This money will be used only for emergencies - such as car repairs, house repairs, appliance repairs or replacements. If you continue to have an income, put in a little every month to always ensure money is in that account.

Create accounts for the kids. Savings/Trust funds to be released to them when they are mature enough (note MATURE enough, not the same as OLD enough. Go by maturity and responsibility level, not age). College funds should be kept separate.

Put a substantial amount in a high yielding savings account. And try not to touch it! This way your money continues to earn MORE money over the years.

Well, everyone wants to travel - but don't go crazy - maybe make a vacation account that will be used 1-3 times every year to go on a nice vacation. Pick a new place every time and eventually you will see the world!

Buy a vacation home - if you have one place you enjoy a lot for a relaxing getaway - buy a place there. It doesn't have to be as big as your regular home - it's just for vacations. Remember your roots - maybe just get a nice vacation trailer in a quiet campground resort. There is nothing wrong with staying in a comfortable and clean trailer with all the utilities.

Avoid the wealthy. Wealthy people will pressure you into buying wealthy and behaving wealthy. The cheap things in life are not good enough for them, they will push you to buy expensive brands, expensive food, and expensive clothes. We all know that is not necessary. A $30 dress from Walmart is just as good as a $1000 dress from some famous designer. Think about what you do with it - you wear it. Do you want to wear $1000 and fret about getting it stained or ripped thereby wasting all that money? Or would you rather feel free and comfortable sitting around in a nice looking $30 dress that isn't such a big deal if it gets accidentally stained or torn. It's alright to splurge now and then - but remember to keep it real!

No need to join Country Clubs or other wealthy clubs of exclusivity. There are plenty of golf courses that you don't have to belong to the club to play.

All in all, keep your lifestyle the same. It will be more enjoyable that way. You can live life peacefully and most of all - comfortably. Because you are wealthy you don't fret about money and bills. But still set an example for your kids with your work (in or out of home). Because life doesn't always treat you right, and they should learn that early. They shouldn't grow up flaunting their wealth. Instead, let them grow up with the other middle-class kids and learn about the realities of life and society. Life will be better for them that way.

1 comment:

Unknown said...

I've been reading through your blog entries that you say you've created for you kids to read someday. Wow! Some good advice for any body here! Thanks for going public with it.