Everybody Loves Your Money

I worry a lot. I suppose that’s one of the reasons that I save. There is too damn much uncertainty in the world. There is not a very big part of me that wishes I’d been born one generation earlier, but there is a little. I mean hell, One generation ago they didn’t have:

-Personal computers
-Ipods
-Microwaves
-Cellular phones
-Cruise control
-Our level of quality health care
-Not to mention a ton of other modern conveniences

On the other hand, they also didn’t have:

-Current level of violence
-Indian call centers
-Chinese garment makers
-Extreme capitalism (returns at all cost)
-Soaring health care costs
-Declining pension plans
-Social security at risk

Which brings me to my personal worries. You probably got a flavor of what I worry about in the bullets above, but just in case you didn’t. Let me give you my list. I worry that:

I won’t have a long healthy life
I won’t be able to retire with enough money to have security
I won’t be able to keep my job long term (due to outsourcing, automation etc)
I won’t have a pension when I retire
I won’t get any social security
My children won’t even have the opportunities that I do today
Our country won’t be competitive globally
We’ll all end up working at McDonalds or Walmart

So, what do I do? I save, and then I save some more. Not to the extent that I’m not enjoying life now, but I do save a LOT. The higher my net worth, the more options I feel I have and the less I have to worry about the above. Every day that I see my net worth climb, I worry a tiny bit less. I can’t wait until I reach my magic number where I feel I have enough security to tell all my worries to go screw themselves!

I’ve decided to start a new campaign. I call it “Paper or Plastic”. Let me explain.

Plastic = credit. You know what this is. 18% interest (or worse).
Paper = cash. We all know what this is. Greenbacks.

I believe you should always use paper. ALWAYS. Sure, there are a few people out there that have the self discipline and knowledge to use credit to their advantage (Jonathon), but for everyone else, you should strive to use paper. Here’s a short list of things:

Groceries: paper
Gas: paper
Entertainment: paper
Eating out: paper
Mortgage: plastic
Everything else: paper

Okay. That pretty much covers it. In my humble opinion, the only thing you should EVER finance or carry debt on is your home. When I say home, I don’t mean, home equity lines of credit to buy consumer goods, I mean, just mortgage payments.

If you need further incentive to use paper instead of plastic, consider this. If you’ve been using plastic (and not paying it off at the end of the month), you are paying more for everything you buy. How much more? Depends on what interest rate you are paying on that debt and how long you carry the debt. But, if you have been on the roller coaster of credit card debt and then get off of it, you instantly give yourself a discount on everything you buy. If you were paying 18% interest on your credit card, it’s like you’ve suddenly been given an 18% off discount on EVERYTHING you buy. Now that’s a deal!

So, when you buy something, pay with paper, and take it away in plastic!

I was going to try to say something smart tonight but I realized that I let my company suck all the words out of me today. I guess I’ll just sit here and seek out other’s words.

On a separate note, I did get another raise. (Second one in 2 months). Last time was a 10% raise. This time it’s another 5%, although it may be temporary, as I’m filling in for someone. Oh well. I’ll take every bit I can get. That helps me jump up to almost 30% surplus income after all investments and bills are paid. I guess I better start trying to figure out something smart to do with this money.

I’m anxiously awaiting the $300K net worth mark. By my calculations, I’ll probably hit it some time in the first quarter unless the stock market and real estate market flatten out. I’ll cross my fingers.

And, in the spirit of rambling: Is it just me, or are the personal finance blogs multiplying faster these days? I’m having trouble keeping up. I did find a new site that is trying to collect as many of these sites as possible. It’s at: http://www.moneyandfinancenews.com
Check it out!