Debt & Consumerism
Some of you may already be following the series on Investing for Young Adults over at ryanwaggoner.com.Â The series was started right around the time Noah was born so I’ve been slowly catching up.Â If you’re at all interested in investing or financial health you should hop on over and check it out.Â You won’t regret it and regardless of where you are in life you can learn something new up from the series.Â Here is a taste of Part 2: Financial Health, these are just a couple parts that really jumped out at me.
The foundation of all wealth-building is this: spend less than you earn and invest the difference wisely. It is impossible to increase your net worth and provide for the future if you spend everything you make, or more.
If you remember nothing else from this entire series, remember this: consumer debt is financial cancer. Consumer debt includes credit cards, payday loans, auto loans, and basically any debt used to finance anything other than an investment. It may seem innocent enough to finance that new car for just $300 / month, but when you go into debt, youâ€™re betting your future. The borrower is slave to the lender. If you canâ€™t afford to pay cash, donâ€™t buy it. This is a simple rule to grasp, but very difficult to follow, especially in our current frenzy of consumerism.