Recently, I’ve been speaking with a number of friends and readers about taking their first steps on the road to frugality and saving for retirement. One of the biggest obstacles in helping people to address their overspending and debt has been getting them to accept change.
If you were driving straight towards a cliff at full speed, is the best move to take your foot off the gas? Is the right solution to turn slightly to the right or left? No! Hell no! You need to slam on the brakes, crank the wheel to the side, pull the parking brake, and press the button on the dash marked “deploy parachutes!”
Big Problems Require Big Solutions
The point I’m trying to make is that expecting to correct major financial disasters with incremental fixes is hopeless. You have to be willing to make uncomfortable, major adjustments in order to address your problems. In most cases, what sound like major changes aren’t functionally any different. It’s just the fear of the unknown that makes them sound dangerous and disruptive.
Take the average American’s mobile phone bill. 46% of Americans pay $100 or more per month for their cellular plan, while the average indebted household has over $15,000 in credit card debt! I pay $30 for unlimited phone minutes, SMS, MMS, and 1 GB of data. I could up that to a preposterous 5 GB of data for a total of only $50! All I had to do was go through a one evening exercise porting my phone number to an MVNO (a reseller of service on a larger company’s network). I didn’t even lose my phone number, and I cut my bill by almost 70%! And yet, even if you lay both the financial and functional realities in front of the average person, they still won’t make changes because change is scary.
Aversion to change might be the single most powerful force holding otherwise rational, smart, and disciplined people back.
Easy First Steps
If you have a major debt disaster on your hands you should do some or all of the following:
- Cut cable
- Switch to an MVNO mobile provider
- Eat every meal at home
- Buy your groceries at Target
- Switching from your expensive gym membership to running or cycling
All of those seem like sensible and painless steps to me, but more often than not, when I tell someone that’s what they should do, they behave as though I’m asking them to perform self-dentistry.
If all of these items seem like more than you can handle, pick one and start with that. I believe in you!
Mainlining Useless Trinkets
We have become a culture that is addicted to luxury. We are bombarded with media that tells us that we deserve it. I am here to tell you: You only deserve what you can afford after paying all of your debts, all of your bills, and contributing meaningfully to your savings! Reject society’s assertion that if you don’t have luxury items, that you have somehow failed. Success is not the acquisition of more stuff. It’s being completely liberated from the compulsion to accumulate useless and overpriced crap that will make you happy for a matter of minutes before joining the pile of other useless and overpriced crap.
I’m susceptible to the same endorphin addiction as everyone else. Knowing that, I can promise you that it’s possible to trigger the same rush you get from holding a new phone, or handbag, or item of designer clothing. I feel it every time I set up a new purchase of my investments. Every other Friday, my net worth jumps up. Even better, I get the same enjoyment every single time I check my net worth and see that it has risen. I can’t say the same about a phone I bought a month ago, or clothes I bought last season.
Aversion To Change Can Be Defeated
The good news is, if you can commit to one major change, you are likely to discover that change isn’t that scary after all. In fact, you start to look at things a different way. You’ll swell with pride as your debt begins to shrink. You may, like me, start finding excuses to challenge yourself to add just a little more to your savings this month, or to spend just a tiny bit less. You’ll look at others with a mix of sorrow and horror as you realize having the newest smartphone or a luxury car adds nothing of meaning to the lives of those around you. After a while you will have eliminated all the easy fixes, and instead of the careening off the edge of that cliff, you’ll be on a rocket ship to early retirement and total financial freedom.
So take your first step. Cut cable. Switch mobile providers. Walk to work. Cancel the gym membership. Make just one meaningful, scary change to improve your financial situation. Pull the lever on your ejector seat, blast off towards your new debt-free life, and gaze out on the future as you drift back to earth.
Be fearless. That’s step one on the road to real freedom.