Everybody has to make choices in terms of time. Most people have to make choices in terms of money. For those in the upper-class, it may be a choice between buying a bigger house or renovating their current home. The lower-income may have to choose between putting food on the table or keeping the lights on. For the middle-class, it’s a never-ending juggling act among various needs and wants.
In order to stay in the Middle-class, it’s essential that you learn how to make the “right” choice for you at the time. There is no ONE RIGHT CHOICE. There are simply choices you make which require sacrificing something else.
Ideally you would do some sort of “swap” which is mentally easier, i.e. I will spend more on travel & spend less on dining out this year. For example, if you want to travel to Paris without incurring credit card debt, you have to budget for trip-related expenses. This means cutting costs elsewhere. For a long time, my husband and I prioritized travel. Now with two school-aged kids, we decided to spend more for housecleaning and baby-sitting. No matter how we looked at it, there was no way we could have it all.
Of course, how much your choices affect your regular day-to-day life depends upon your spending habits and income.
It isn’t fun or easy to make these choices. That’s why I’m calling them Hard Choices! You have to be able to delay gratification, plan ahead, miss out on some fun events, or wear last year’s fashion. It’s even harder when big-budget needs (like home or car repairs) always seem to take precedence over wants (like travel and new smartphone).
Not all choices are between a need and something that is clearly a want. There will be times you want or need to spend on career development whether that is joining a professional group, attending a conference in your field, or getting additional education. What makes this choice one of the hardest is that you can’t know if this “investment” will pay off. You can attend many conferences and not meet the right people. You can pay for an advanced degree and not get the job of your dreams.
Finally, if these choices involve other family members or friends, you will not agree on priorities every time.
Here’s a look at my family’s current want/need list:
1) Dental Work (Both) – $500 to $2,000
2) iPad or Tablet (Kids, Me) – $600
3) Organic foam mattress or topper (Both, more me) – $1,000 – $2,200
4) Airplane ticket to home country (Spouse) – $1,300+
5) Semi-professional camera (Spouse) – $1,800 +
6) Car #1 Repairs (Spouse) – $1,000
7) Car #2 Maintenance (Me) – $200 to $500
Without any additional details, can you easily prioritize the above? I will add details (justifications) in another post. More to come!
This is one in a series of tips/ideas to help you stay middle-class (HTSMC). Whether you consider yourself on the lower- or higher-end of the spectrum, you can probably find some useful tips to help you stay there and find save more for retirement even as wages stay stagnant.