As the economy tightens around us, I think we all feel a little poorer than we did even a few months ago. I read a few things in the past week that I have been thinking about.
1. Save Pennies, Spend Dollars
When times are tight (or perceived to be tight), it is still important to do the important things. Spending your child to private school or investing in a new business are those types of important things. To spend dollars on those things, you may have to scrimp on the things that don't matter as much. Save pennies elsewhere to make bold, purposeful investments where you need to. So, if celebrating a milestone birthday with a loved one is one of those important things, celebrate big (and bike to work the rest of the month)!
2. All Economics is Micro-Economics
I know the academics would disagree, but for most of us the only economics that matters is that which is very personal to us, close in physical proximity or time. Of course, the world economy is intertwined, but most of don't need millions of jobs, we only need one. We don't need a large bank, we just need someone to give us a return on the use of our money (which could be a micro-loan we make). The economy in our local community and the tax-base of public services we use is more important to us than the larger trends of housing starts across the country. Even our own retirement portfolio is only super critical if we are actively spending it (close proximity in the dimension of time).
3. Wealth is a Feeling, not a Bank Balance
I remember hearing a joke: "I have all the money I will ever need," the comic said. "As long as I don't spend another dime." How true. A feeling of wealth is still comes down to spending less than we earn, individually. Mr. Macawber, from Dickens' fame, wrote pointly about this type of micro-economics when he said that "to have an income of twenty pounds per annum, and spend twenty pounds and sixpence, is to be the most miserable of men; whereas, to have an income of only twenty pounds, and spend but nineteen pounds and sixpence is to be the happiest of mortals." Apparently, wealth is an emotion, like contentment or anxiety, that can be managed by perception and by personal action.
So, although we need to be concerned about the economy, about the bank bail-outs, the political races, and other things that good citizens need to stay up with, remember that the micro-economics matter the most. I wish you all wealth, in the truest emotional sense of the word.
1. Save Pennies, Spend Dollars
When times are tight (or perceived to be tight), it is still important to do the important things. Spending your child to private school or investing in a new business are those types of important things. To spend dollars on those things, you may have to scrimp on the things that don't matter as much. Save pennies elsewhere to make bold, purposeful investments where you need to. So, if celebrating a milestone birthday with a loved one is one of those important things, celebrate big (and bike to work the rest of the month)!
2. All Economics is Micro-Economics
I know the academics would disagree, but for most of us the only economics that matters is that which is very personal to us, close in physical proximity or time. Of course, the world economy is intertwined, but most of don't need millions of jobs, we only need one. We don't need a large bank, we just need someone to give us a return on the use of our money (which could be a micro-loan we make). The economy in our local community and the tax-base of public services we use is more important to us than the larger trends of housing starts across the country. Even our own retirement portfolio is only super critical if we are actively spending it (close proximity in the dimension of time).
3. Wealth is a Feeling, not a Bank Balance
I remember hearing a joke: "I have all the money I will ever need," the comic said. "As long as I don't spend another dime." How true. A feeling of wealth is still comes down to spending less than we earn, individually. Mr. Macawber, from Dickens' fame, wrote pointly about this type of micro-economics when he said that "to have an income of twenty pounds per annum, and spend twenty pounds and sixpence, is to be the most miserable of men; whereas, to have an income of only twenty pounds, and spend but nineteen pounds and sixpence is to be the happiest of mortals." Apparently, wealth is an emotion, like contentment or anxiety, that can be managed by perception and by personal action.
So, although we need to be concerned about the economy, about the bank bail-outs, the political races, and other things that good citizens need to stay up with, remember that the micro-economics matter the most. I wish you all wealth, in the truest emotional sense of the word.
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