Unlike most people I know, I regulate carefully the spending of small amounts of money on things like clothes, haircuts, manicures, books I want to read once but can just as easily get on interlibrary loan if I wait, bottled water, soda, coffee, treats and prepared foods, eating out, and in general any food item that doesn't derive from the grocery store or somebody's garden. How did it come to seem normal for middle-class and even working-class people to spend so much on prepared food so many times per week? This is not, by the way, moralizing on behalf of elaborate slow-food family dinners--not that I'm against that stuff either, if you like it--but for myself I favor the fastest food there is: bread and peanut butter and fruit straight out of the fridge, for instance. The cost in both time and money is negligible. I really don't understand the desire to spend more. Why isn't retaining their money worth more to people than a series of impulsive mini-luxuries and illusory conveniences throughout the week?
Advertising has something to do with it, and so does habit and social norms, and a general background level of prosperity--compared to the third world, anyway. (I'm aware that relative incomes are slipping in the US for all but the top percentiles.) And each individual item, taken singly, doesn't cost a huge amount. It just costs way more than it needs to and is unnecessary. A twenty-dollar bottle of moisturizer? Thanks, I'll hold onto the $20, "because I'm worth it." (I know, I know, that's not even anywhere near the high end products.)
I don't mean to scold or set myself up as superior. Everyone has the right to determine their own priorities; I just advocate awareness: for instance that the cumulative amount spent buying sodas each month (compared to the amount spent on more nutritious food staples) really does reflect the proportionate position a person thinks soda ought to occupy in his life.
I'm aware too that my habits are way outside the norm, freakish by current cultural standards. It hurts to suspect that some of my nearest and dearest may think me "cheap." I don't think of myself that way. I didn't buy the cheapest house I could find, or the cheapest car. Ditto furniture and major electronic appliances. Those are long-term investments and I want to get the best long-term value I can. I love going to museums or getting tickets to other artistic performances. But I don't want to drop unmonitored little bits of money on restaurant food or objects and services whose ability to provide satisfaction is fleeting. The cumulative effect is significant.
This is not a moral issue. It's practical, like a well-insulated house. You want all the money you invest in heating and cooling to go directly to your comfort, instead of being dissipated uselessly outside of your own living space. You want to eliminate leaks.
The worst sort of financial leak there is, is consumer debt. Of course, go into debt for a house or car or an education: those things can be worth it because in the right circumstances they promote your long-term assets. But nothing else is worth debt. All money spent paying interest is money that could otherwise have been spent to enhance your life. If you cumulatively spend more on consumer purchases than you can cover with your income, and make up the difference with credit cards, you are reducing your spending power, not increasing it. This is obvious enough, and in fact, I've learned recently that a slight majority of US citizens don't pay any interest at all to credit card companies, either because they don't have credit cards (about 25%) or (another 30%, including me) because they pay off every new charge within the grace period before the interest is applied. Prior to googling up some statistics while writing this blog post, I was under the misapprehension that the average American pays a whopping credit-card interest charge on a regular basis. Not so. But a good-size minority does, only a whisker less than half. The average amount of income that went to credit-card debt among households carrying a credit-card balance was 21% in 2004. Now, since the financial meltdown, it's down to under 17% in most places, but still, OMG, 17% is a sixth of your income, a hefty fraction, and many people are forking over that much or even more of their resources mostly just to purchase the privilege of continuing to owe money while chipping away with a teaspoon at the original purchase amounts (paying the credit-card minimums ensures that total interest expenses will comfortably outweigh the principal amount). What a trap.
A person mired in consumer debt is in exactly the same position as a sharecropper.
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