Our grandparents grew up in a time when you had to learn to be resourceful. Things were fixed and not replaced, women made their own clothes and neighbors shared one phone. Things were purchased because they were necessary, not because they were simply wanted – and guess what? No one would ever have dared to refer to your Nana as a cheap-ass.
So where did we go wrong? Research from Ohio State found that People in their late 20s and early 30s carry significantly higher credit card debt than older generations and pay it off way more slowly. Much of this can be attributed to the rising costs of education, but the bigger problem in my opinion, is our generation’s fear of looking cheap.
Success is naturally equated to wealth, and no one idolizes someone who is not successful. On top of that, the American Dream has morphed into a whole other level of status and luxury. We see rappers in chinchilla jackets popping Ace of Spades champagne in their videos, not driving a Toyota and having game night in with their friends.
Kanye said it best– “What you think I rap for, to push a f*cking Rav4?” In the pop culture of today, having the appearance of wealth trumps actually having any money. What needs to be understood, though, is that people who are really wealthy actually attribute frugal (or “cheap”) habits to getting and staying there.
The number one quality of successful people is living below their means, and this means being frugal. For example, there are 1,138,070 millionaire households living in homes valued under $300,000, yet at the same time, 86% of people driving the most expensive “status” cars are non-millionaires.
People who actually have money are not scared of looking cheap – that’s how poor people think, and it keeps them poor.
I’ve personally lived in NYC for nine years, and I saved a reasonable about of money working as a waitress and a model. It’s true – I was fortunate to have fit the bill for these particular jobs, but it’s not like I was booking $30,000 campaigns. I just lived in an affordable apartment, I never took taxis, and I never feared being labeled as cheap.
Did people call me cheap because I always looked for better deals and watched my spending? Sure, but while they racked up their debt in an attempt to show everyone how well they were doing, I was putting myself in the position to have the money to invest in my future – to create more opportunity and success for myself.
Who knows, maybe this is what will separate the rich from the poor, like a survival of the fittest? Those who know how to sacrifice will be the ones who ultimately live in comfort, and those who feared looking cheap while they were rocking Louboutins and Gucci loafers will ultimately live in their parents' house when they’re 35. Wondering where you fall in all of this? Well the next time you put your credit card down, ask yourself what kind of American Dream you’re investing in.
Ashley Stetts | Elite.
To read more from Ashley visit her blog, The Frugal Model.