I had a friend contact me recently and ask how to respond to someone who told her, “…if I made what you made then I would be debt free too.” Since I’ve gotten that remark (or a close variation of it) several times in my coaching experience, let’s spend some time on that idea today. First, I’d like to point out the very first book (really a booklet) I wrote on personal finance is titled, “It’s Not About Money“…and for good reason. Let me also point out that our family is 100% debt free, including our home and cars…and we live on a single (reasonable) salary for our family of five. Let me be blunt: don’t use your income (or lack of it) as an excuse to make poor choices with money.
Let me relay two stories that explain my point (changing names a bit to protect confidentiality):
When I met George, he was pretty much broke. He didn’t make much money and he wasn’t managing it whatsoever. He was deep in debt, including some rent-to-own messes where he was facing repossession. George had his bedroom suite (including his bed) repossessed. He called me and told me he truly understood Proverbs 22:27, which says, “if you lack the means to pay, your very bed will be snatched from under you.” To top it off, in the midst of his mess, George fell ill and had to stop working. The situation was not good, but George was determined. To make a fairly long story much shorter, George ended up on a fixed Disability income, earning $674 per month. Although it took a lot of time and very creative, albeit legal and safe, ways to earn his way in the world, George was able to get back on his financial feet and pay off all his debts. He now lives in his own apartment, drives a decent, paid-for car, wears nice clothes and even gives to the local church. George radically changed his life because he realized that’s what he had to do to break the chains of his financial bondage.
A few weeks after I experienced such success with George, I had a couple come to me for coaching. Mr. Smith made $105,000 per year; Mrs. Smith about $60,000 per year. Together, they could not scrape together enough money each month to pay all their bills. These weren’t medical bills or other necessity-based expenses – these were “keeping up with the Joneses” (and more) bills. I met with them once, provided much the same counsel to them I had initially given George, and they never followed up because they didn’t believe they could make the necessary changes to get out of debt.
Neither George nor the Smiths were extraordinary in any way. George decided it was worth it to make the changes necessary to win – the Smiths decided pride was more important. George would tell me stories of how he would help some of the people around where he lived in exchange for the junk they wanted rid of. He would disassemble it for scrap metal or other things of value. Anytime George was out and about, he would look for opportunities to save money or earn some more. George had the fire in his eye that he needed. The Smiths were afraid of what the neighbors might say if they didn’t trade in their “old” BMW every year for the new model.
Success with money almost never comes down to income – it comes down to priorities and a willingness to change. Of course, SOME income is necessary, but I’ve watched people who earn minimum wage live great and full lives. I’ve watched people who earn 2-3x as much as I do whine and complain about never having enough. So for my friend, here’s a good article to share with those who may tell you they can’t succeed because they don’t make as much as you. For everyone else, don’t believe the lie that more money is the answer to your financial problems.