One of the things that many of us aspire to be is, surprisingly, average. We want to have the same things that those around us have. (Or at least, have the same things we think those around us have.) This is natural. We all like to feel as though we belong.
However, it’s not always best to be average — especially when it comes to money.
After all, do you really want to spend money on something just because someone else is? Do you really want to buy something just to maintain appearances?
Average = Debt
Even though the recent recession saw an increase in the savings rate and a reduction in debt levels, there’s still quite a bit of debt out there. On average, the American household has several thousand dollars in credit card debt.
The average American borrows to pay for college, to buy a car, and to buy a home (not to mention borrowing for other things, like furniture, vacations, and weddings).
It’s true that some of the things we borrow for have some other value. I’ve borrowed to pay for my education, my transportation, and my shelter. These are things that enhance my quality of life, and that I would have a very hard time saving up for to pay in cash. (As a student, I racked up credit card debt, and I regret that. That’s done with now, though, and I pay for most things without debt.)
What are you willing to go into debt for, and why? Before you even borrow for “good” debt, like a house, consider why you’re purchasing the home. We bought a house because we wanted a stable place in a good school district for our son.
We also bought a home that was less than half what the bank said we were approved for. We could have bought a bigger, fancier house and lived on the mountainside, but we didn’t want to spend that much. We have other priorities.
Instead of Going for Average, Go for What You Want
According to the New York Times, the average size of a TV in North America is 38 inches. Everyone I know with a TV has at least a 50-inch model, though. Our TV is 32 inches, because we just don’t care about having a big TV.
We spend our money on other things, like Lord of the Rings action figures and trips. It’s not exactly “average,” especially in my neighborhood, but it’s what we like to do with our money.
That should really be the focus of your saving and spending decisions. Rather than asking yourself whether you have what others do, and whether you look “normal,” consider your financial priorities and bring your spending in line with them.
It might be comforting to be average, but it can also get confining. Figure out what you prefer to spend your money on, and then adhere to those principles. You don’t have to be average.
How have you applied these practices in your own life?