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Is Being Basic Costing You Money?

Is Being Basic Costing You Money?

Is being basic costing you money?

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There's been a term floating around for a few years now called "basic." Urban Dictionary defines it as someone who "engages in typical, unoriginal behaviors, modes of dress, speech, and likes." Is there anything wrong with liking the things that are being mass marketed to us? Absolutely not, BUT, sometimes we have to start doing the unconventional to be able to get off of the same hamster wheel that everyone is on. Being average in the world of Financial Independence sometimes carries a price. 

NerdWallet.com recently released some staggering statistics from their 2017 American Household Credit Card Debt Study. The average U.S. household carries quite a hefty load of debt, but it did not seem surprising though. The challenge with these numbers is that they seem normal, average, and my point here is that it doesn't have to be. Interestingly, when we drill down to the other aspects of the survey, around 41% stated that "spending more than I can afford on unnecessary purchases" was the #1 contributing factor to people going into credit card debt. This is a problem. 

 
Type of Debt Average Debt
Credit Cards $15,654
Mortgages $173,995
Auto Loans $27,669
Student Loans $46,597
Other Debt $131,431
 
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If we want to be Financially Independent, we have to start thinking differently. We have to move away from the norm of spending, reject what is being mass marketed to us and chart a new path. Consumption is one of the biggest barrier to Financial Independence. If we are constantly chasing the next new, shiny thing, we will always be behind. 

We have to change our mental models on debt and spending. Just because it's being mass marketed, it doesn't mean we have to have it. We don't need to always have a car loan. Sometimes people get used to those dollars getting taken out every month that they assume it's the norm. No, it doesn't have to be. We don't need to be paying our mortgage for 30 years. There are ways to pay it in 15 years or 20. If we continue down the path of the average American, we will need to work into our old age and unfortunately for many Americans, old age  is no longer the golden age. Take a look at what retirement looks like for those without any savings. The goal of Financial Independence is to retire when the income is right, not when the retirement age arrives. 

If basic means being average and being average means constant debt, then we need to re-assess. I'm not against Instagramming, leggings, brunch or the messy top bun, but we have to see if our "basic" spending is putting us in a hole. 

Some "basic" spending to assess:

  • Victorias Secret Splurges
  • Starbucks Runs
  • Ulta Makeup Hauls
  • Uber and Lyft Personal Chauffeur
  • Brunch & Seamless Binges
  • Target Runs
  • Subscription Boxes (JustFab, StichFix, BirchBox)

What do you think? Do you spend your money on "basic" things? Would you be willing to give up some of the "basic" expenses for a week? How much would you save?

 
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